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IMF Fossil Fuel Subsidies Data: 2023 Update

Simon Black, Antung Liu, Ian Parry and Nate Vernon

No 2023/169, IMF Working Papers from International Monetary Fund

Abstract: This paper provides a comprehensive global, regional, and country-level update of: (i) efficient fossil fuel prices to reflect supply and environmental costs; and (ii) subsidies implied by charging below efficient fuel prices. Globally, fossil fuel subsidies were $7 trillion in 2022 or 7.1 percent of GDP. Explicit subsidies (undercharging for supply costs) have more than doubled since 2020 but are still only 18 percent of the total subsidy, while nearly 60 percent is due to undercharging for global warming and local air pollution. Differences between efficient prices and retail fuel prices are large and pervasive, for example, 80 percent of global coal consumption was priced at below half of its efficient level in 2022. Full fossil fuel price reform would reduce global carbon dioxide emissions to an estimated 43 percent below baseline levels in 2030 (in line with keeping global warming to 1.5-2oC), while raising revenues worth 3.6 percent of global GDP and preventing 1.6 million local air pollution deaths per year. Accompanying spreadsheets provide detailed results for 170 countries.

Keywords: Fossil fuel subsidies; efficient fuel prices; supply costs; climate change; local air pollution mortality; revenue gains; energy price surge; non-pricing reform; spreadsheet tools; IMF fossil fuel subsidies datum; price reform; air emission fee; supply cost; Fuel prices; Non-renewable resources; Energy subsidies; Greenhouse gas emissions; Global; North America; East Asia; Caribbean; South Asia (search for similar items in EconPapers)
Pages: 32
Date: 2023-08-24
New Economics Papers: this item is included in nep-ene, nep-env and nep-tre
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Handle: RePEc:imf:imfwpa:2023/169