LONDON, Aug 24 (Reuters) - Global subsidies for fossil fuels rose by $2 trillion over the past two years to reach a record $7 trillion in 2022, according to new estimates from the International Monetary Fund.
The soaring costs, driven by post-pandemic consumption growth and by rising energy costs stemming from Russia's 2022 invasion of Ukraine, are straining budgets, adding to pollution and exacerbating global warming, the IMF said in a report.
"Subsidies for oil, coal and natural gas are costing the equivalent of 7.1% of global gross domestic product," the IMF said.
The IMF said that these costs are likely to fall now that energy prices have eased, which it said was an ideal time to scrap subsidies.
"Falling energy prices provide an opportune time to lock in pricing of carbon and local air pollution emissions without necessarily raising energy prices above recently experienced levels," it said.
Persons:
Libby George, Frances Kerry
Organizations:
International Monetary Fund, IMF, Thomson
Locations:
Ukraine, Africa