World Energy Outlook 2006

140%
120%
100%
Figure 11.6: Change in Average Annual IEA Crude Oil Import Price and
Road Fuel Prices in Ten Largest Oil-Consuming Countries, 1999-2005
180%
IEA average
160% crude price
80%
60%
40%
20%
0%
India
Note: All prices are in real terms.
United
States
China
Russia
Local road fuel prices
Germany
OECD
average
between 1999 and 2005 in real terms. In many non-OECD countries, local gas
prices have not increased significantly, because prices are set independently of
international market conditions. In China, for example, where gas prices until
recently have been set with little regard for international price movements, final
prices to industry and households have risen only modestly since a new pricing
structure was introduced in 1997. The price for end users of coal, which is
rarely taxed at all, has risen more in percentage terms than any other final fuel
on average in the OECD countries – even though international prices have
increased less than those of oil and gas.
Movements in electricity prices in recent years vary considerably among
countries, according to the fuel mix in power generation, government policies
and regulations, and other local factors. On average, final pre-tax electricity
prices (in nominal terms) in OECD countries were broadly flat through the
1990s and have increased only modestly since 2001. Between the first quarter
of 2001 and the first quarter of 2006, industrial prices rose by less than a third
and household prices by less than a fifth.
Quantifying Energy Subsidies
Energy consumption subsidies – government measures that result in an enduser
price that is below the price that would prevail in a truly competitive
market including all the costs of supply – are large in some countries. Energy
is most commonly subsidised through price controls, often through stateowned
companies. Consumption subsidies have been largely eliminated in the
Chapter 11 - The Impact of Higher Energy Prices 277
Korea
Canada
Japan
France
Mexico
11
© OECD/IEA, 2007