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Fossil-fuel subsidies in focus at climate talks
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The problem is that getting rid of them comes with a heavy political price.
When Jordan raised fuel prices last month, angry crowds poured into the streets, torching police cars, government offices and private banks in the most sustained protests to hit the country since the start of the Arab unrest. One person was killed and 75 others were injured in the violence.
Nigeria, Indonesia, India and Sudan also have seen violent protests this year as governments tried to bring fuel prices closer to market rates.
Iran has used a phased approach to lift fuel subsidies over the past several years, but its pump prices remain among the cheapest in the world.
“People perceive it as something that the government is taking away from them,” Mr. Kretzmann said. “The trick is we need to do it in a way that doesn’t harm the poor.”
The International Energy Agency found in 2010 that fuel subsidies are not an effective measure against poverty because only 8 percent of such subsidies reached the bottom 20 percent of income earners.
The IEA, which looked only at consumption subsidies, this year said they “remain most prevalent in the Middle East and North Africa, where momentum toward their reform appears to have been lost.”
In the U.S., environmental groups say fossil-fuel subsidies include tax breaks, the foreign tax credit and the credit for production of nonconventional fuels.
Industry groups such as the Independent Petroleum Association of America are against removing such support, saying that would harm smaller companies rather than the big oil giants.
In Doha, Mohammed Adow, a climate activist with Christian Aid, called all fuel subsidies “reckless and dangerous” but described removing subsidies on the production side as “low-hanging fruit” for governments if they are serious about dealing with climate change.
“It’s going to oil and coal companies that don’t need it in the first place,” he said.
Associated Press writers Abdullah Rebhy in Doha and Brian Murphy in Dubai, United Arab Emirates, contributed to this report
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