There have been some complaints that the gas price is rising here in Yemen. The “official” price for 20 liters of gas is 1200 YR, that’s about $1.14 a gallon. Recently, there have been complaints that places are refusing to do 20 liters for that price, they “demand” 1800 YR instead. That’s a 50% increase, and that’s got to mean something. The government owned stations are still pumping at the official price, but if other stations can get away with charging 50% more, then I predict that the government stations will have long lines if not actual shortages. There’s no stopping prices, if price is rising, either supply is dropping or demand is increasing. In either case, there is less gas than there is demanded… The last time the government tried to raise prices there were riots. The same thing happened in Iran when they tried to raise the price of gasoline. As the price for gas keeps going up, governments (and especially ones like Iran and Yemen) can afford subsidies less and less. That’s one of the big problems with subsidies, people quickly become accustomed to the low prices and it doesn’t take too long before they feel entitled to them. When are governments going to learn?
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