Identifier
Created
Classification
Origin
07DAMASCUS1075
2007-11-01 15:11:00
CONFIDENTIAL
Embassy Damascus
Cable title:
SYRIANS WAKE UP TO GASOLINE PRICE HIKE
how-toVZCZCXYZ0003 OO RUEHWEB DE RUEHDM #1075 3051511 ZNY CCCCC ZZH O 011511Z NOV 07 FM AMEMBASSY DAMASCUS TO RUEHC/SECSTATE WASHDC IMMEDIATE 4331 INFO RUEHAD/AMEMBASSY ABU DHABI PRIORITY 1345 RUEHAM/AMEMBASSY AMMAN PRIORITY 7132 RUEHAK/AMEMBASSY ANKARA PRIORITY 5370 RUEHGB/AMEMBASSY BAGHDAD PRIORITY 0592 RUEHLB/AMEMBASSY BEIRUT PRIORITY 4788 RUEHEG/AMEMBASSY CAIRO PRIORITY 3475 RUEHKU/AMEMBASSY KUWAIT PRIORITY 1278 RUEHMK/AMEMBASSY MANAMA PRIORITY 0624 RUEHRH/AMEMBASSY RIYADH PRIORITY 7905 RUEHTV/AMEMBASSY TEL AVIV PRIORITY 2029 RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY RUEAIIA/CIA WASHDC PRIORITY RHEHNSC/NSC WASHDC PRIORITY RHEFDIA/DIA WASHDC PRIORITY RUEATRS/DEPT OF TREASURY WASHDC PRIORITY
C O N F I D E N T I A L DAMASCUS 001075
SIPDIS
SIPDIS
STATE FOR NEA/ELA
E.O. 12958: DECL: 11/01/2017
TAGS: ENRG EPET SY
SUBJECT: SYRIANS WAKE UP TO GASOLINE PRICE HIKE
REF: DAMASCUS 949
Classified By: A/DCM Todd Holmstrom for reasons 1.4(b,d)
C O N F I D E N T I A L DAMASCUS 001075
SIPDIS
SIPDIS
STATE FOR NEA/ELA
E.O. 12958: DECL: 11/01/2017
TAGS: ENRG EPET SY
SUBJECT: SYRIANS WAKE UP TO GASOLINE PRICE HIKE
REF: DAMASCUS 949
Classified By: A/DCM Todd Holmstrom for reasons 1.4(b,d)
1. (SBU) Syrians awoke on November 1 to find that the SARG
had increased the price of gasoline by 20 percent overnight,
from 30 to 36 SP/liter (USD 2.27 to 2.72/gal). The increase
was less than the 40 SP/liter price many economists had
predicted during a heated public debate over the need to
eliminate fuel subsidies in late August (see reftel).
2. (SBU) Not surprisingly, rumors are again running rampant
in Damascus that this morning's price hike portends increases
in the price of mazout (diesel) and butane gas in the near
future. The debate over fuel subsidies dissipated suddenly
six weeks ago with the onset of Ramadan, leaving many Syrians
to believe that pro-subsidy regime elements had successfully
argued in favor of indefinitely postponing any increase in
fuel prices. In January 2006, the last increase in gasoline
prices led to similar speculation, but ultimately the SARG
decided not to take the more controversial -- and politically
difficult -- decision to raise diesel prices. Because of the
widespread use of diesel fuel in industry, agriculture and
power generation, such a move would have a more profound
effect on the average Syrian than an increase in gasoline
alone, according to local economists.
--------------
COMMENT
--------------
3. (C) The timing of this decision seems tied to yesterday's
Cabinet approval of the Finance Ministry's proposed 2008
budget, which projected the largest budget deficit in recent
memory. Having explained the economic imperative justifying
the gas price increase, the real question is whether the
regime feels confident enough to now enact additional
subisidy cuts. Bashar's domestic standing, while not under
the severe strain of two years ago, is still suffering from a
loss of prestige in the wake of the September 6 Israeli Air
Force attack.
CORBIN
SIPDIS
SIPDIS
STATE FOR NEA/ELA
E.O. 12958: DECL: 11/01/2017
TAGS: ENRG EPET SY
SUBJECT: SYRIANS WAKE UP TO GASOLINE PRICE HIKE
REF: DAMASCUS 949
Classified By: A/DCM Todd Holmstrom for reasons 1.4(b,d)
1. (SBU) Syrians awoke on November 1 to find that the SARG
had increased the price of gasoline by 20 percent overnight,
from 30 to 36 SP/liter (USD 2.27 to 2.72/gal). The increase
was less than the 40 SP/liter price many economists had
predicted during a heated public debate over the need to
eliminate fuel subsidies in late August (see reftel).
2. (SBU) Not surprisingly, rumors are again running rampant
in Damascus that this morning's price hike portends increases
in the price of mazout (diesel) and butane gas in the near
future. The debate over fuel subsidies dissipated suddenly
six weeks ago with the onset of Ramadan, leaving many Syrians
to believe that pro-subsidy regime elements had successfully
argued in favor of indefinitely postponing any increase in
fuel prices. In January 2006, the last increase in gasoline
prices led to similar speculation, but ultimately the SARG
decided not to take the more controversial -- and politically
difficult -- decision to raise diesel prices. Because of the
widespread use of diesel fuel in industry, agriculture and
power generation, such a move would have a more profound
effect on the average Syrian than an increase in gasoline
alone, according to local economists.
--------------
COMMENT
--------------
3. (C) The timing of this decision seems tied to yesterday's
Cabinet approval of the Finance Ministry's proposed 2008
budget, which projected the largest budget deficit in recent
memory. Having explained the economic imperative justifying
the gas price increase, the real question is whether the
regime feels confident enough to now enact additional
subisidy cuts. Bashar's domestic standing, while not under
the severe strain of two years ago, is still suffering from a
loss of prestige in the wake of the September 6 Israeli Air
Force attack.
CORBIN