Gasoline is only $1.78 a gallon on average in the United Arab Emirates, but soon prices will more closely match global price averages. Oil prices are currently low, to the extent that it is hurting the country’s economy and the Energy Ministry decided to end gas subsidies.
The decision was made despite the fact that oil prices are expected to rise again. Energy Minister Suhail al-Mazroui hopes ending gas subsidies will encourage people to use public transportation and reduce carbon emissions. A healthy public transport industry could have long-term positive effects on the country’s economy, as well.
Most of the wealthy country’s money is derived from the extraction and distribution of oil, but they have also foreseen a world in which fossil fuels are no longer the primary energy source. The UAE has been preparing their infrastructure to support growth in other sectors of the economy.
One project that demonstrates the UAE’s commitment to moving forward into a post-fossil fuel society is the Masdar City. This city runs entirely on solar and wind power, and is minimum-waste.
Many countries, including the US, still give hundreds of thousands of dollars, if not millions, to oil and gas companies every year, even though they are some of the wealthiest companies on the planet. These policies used to make sense when fossil fuel extraction was harder to find, because there was a chance that the oil well would be a “dry hole”, or not produce any oil. Now, with modern technology, dry holes are nearly a thing of the past and the companies are wealthy enough to absorb the loss should it happen.