Gas prices, discontent rising in Iraq

Gas prices, discontent rising in Iraq
By Andrea R. Mihailescu
THE WASHINGTON TIMES
April 10, 2006


In what is seen as an unavoidable trade-off, Iraq's acting government is risking public anger by ramping up gasoline prices to boost revenues and reduce a gas-smuggling trade that is helping to fund the insurgency.
Heavily subsidized since the days of Saddam Hussein, the price of gas has risen from about 5 cents a gallon to 10 cents a gallon, and is expected to rise dramatically in the coming months, despite the threat of street protests and other signs of discontent.
Robert Silverman, director of the State Department's Office of Iraq Economic Affairs, told an audience at Rice University's James A.Baker III Institute for Public Policy on March 30 that he expected the price to reach 50 cents a gallon by the end of the year.
Several violent demonstrations greeted an announcement in December that prices would be boosted, and it is not clear how the further price increases will be received in a country where driving is popular and the average annual income is about $1,500.
But the gas subsidies have placed a huge burden on the Iraqi treasury, amounting to $8 billion a year in lost revenues, or 30 percent of the nation's gross domestic product. U.S. congressmen have also complained about U.S. taxpayer funds being used to purchase gas in neighboring countries for sale in Iraq at such low prices.
Mr. Silverman said higher gas prices also are needed to attract foreign investment into a struggling refinery industry. Despite having some of the world's largest crude-oil reserves, Iraq still imports some 200,000 barrels per day of refined products, at a cost of $200 million to $250 million per month, according to the Energy Information Administration, a branch of the U.S. Department of Energy.

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Hm, if you change the word Iraq to the USA this article could be about the USA. SSDC (Same Shit Different Country)