• 4 minutes Oil Price Could Fall To $30 If Global Deal Not Extended
  • 7 minutes Middle East on brink: Oil tankers attacked off Oman
  • 11 minutes CNN:America's oil boom will break more records this year. OPEC is stuck in retreat
  • 14 minutes The Latest: Iranian FM Says US Cannot Expect To ‘Stay Safe’
  • 16 mins The Pope: "Climate change ... doomsday predictions can no longer be met with irony or disdain."
  • 1 min The Plastics Problem
  • 8 hours US Shale Drilling lacks regulatory body.
  • 2 hours Ireland To Ban New Petrol And Diesel Vehicles From 2030
  • 10 mins Emissions Need To Be Halved To Avoid 3C Warming
  • 4 hours Solar Panels at 26 cents per watt
  • 4 hours Trudeau approves Trans Mountain Pipeline
  • 1 hour Venezuela's Maduro sneaks $300 million of gold out of country to Africa.
  • 7 hours Huge UK Gas Discovery
  • 15 hours Why Is America (Texas) Burning Millions of Dollars Per Day Of Natural Gas?
  • 15 hours The Magic and Wonders of US Shale Supply: Keeping energy price shock minimised: US oil supply keeping lid on prices despite global risks: IEA chief
  • 8 hours OPEC, GEO-POLITICS & OIL SUPPLY & PRICES
  • 7 hours Malaysia Oil & Gas Updates
  • 1 hour Coal Boom in Asia is Real and a Long Trend
  • 1 hour Fareed Zakaria: Canary in the Coal Mine (U.S. Dollar Hegemony)

Breaking News:

Oil Stabilizes On Small Crude Draw

Fossil Fuel Industry Receives $1.3 Trillion in Subsidies Each Year

The International Monetary Fund has released a recent study titled ‘Energy Subsidy Reform: Lessons and Implications’ which calculates that in 2011 the world offered the fossil fuel industry subsidies amounting to $1.3 trillion, or 8% of the total global government revenues.

The largest subsidiser in the world by far was the United States, gifting $502 billion to the fossil fuel industry, China was second at $279 billion, and Russia was third, offering $116 billion.

According to CleanTechnica, the IMF has estimated that in order for the US to correct the situation, it will need to setup a new system of fees, levies, and taxes that will cost more than $500 billion a year.

Related article: Oilprice.com Intelligence Report: The IMF vs. Energy Subsidies

The largest contributor to the subsidies is the failure to properly price carbon pollution, costing a little over $1 trillion.  This failure to effectively include the pollution costs into the consumer price of the fossil fuels, via the use of a carbon tax, or a cap-and-trade system, has led to the world’s economic giants becoming the largest subsidy payers.

Pre-tax subsidies, included in the tax code, and mostly offered by oil producing countries in the Middle East and North Africa, add an extra $480 billion to total. And then VAT exemptions offered by many other countries contribute another several hundred billion dollars.

By. Joao Peixe of Oilprice.com



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News