Moroccan government spends $180mn monthly on butane gas subsidies

Morocco expects to spend up to MAD 1.6bn ($180mn) per month to subsidise butane gas, widely used for cooking, electricity and public transport, as it seeks to stabilise prices amid sharp global energy market volatility, Finance Minister Fouzi Lekjaa said on April 2, cited by Erem News.

The Moroccan government said earlier that the country holds fuel reserves covering just over 47 days of diesel and 52 days of petrol, below the legal minimum of 60 days, which raises several concerns about energy security. The 2026 regional conflict has triggered the largest supply disruption in history by halting nearly 20% of global oil and LNG transit through the blocked Strait of Hormuz, causing Brent crude to surge toward $120 per barrel.

The move forms part of a broader support package worth MAD 1.65bn aimed at cushioning the economic impact of ongoing tensions in the Middle East. Measures include freezing prices for butane gas, electricity and transport.

Around MAD 600mn has been allocated to maintain butane prices, with the government now covering MAD 78 per 12kg cylinder, up from MAD 30 before the recent surge in global prices. International butane prices have risen by more than 68% since early March. Although prices vary slightly between service stations, they are largely determined by distribution companies in line with international market movements.

An additional MAD 400mn has been earmarked to stabilise electricity tariffs, ensuring prices remain unchanged for households and other consumers despite higher generation costs.

The package also includes direct fuel support of MAD 3 per litre for transport operators between March 15 and April 15, at a monthly cost of around MAD 648mn. The subsidy targets taxis, buses, school and tourist transport, and rural mixed transport services.

Fuel prices in Morocco have risen by around 30% since late February. The country remains fully reliant on imports for refined fuels following the closure of its sole refinery in 2015.