IMF estimates suggest that fuel prices in most countries are far below efficient prices. Efficient prices are fuel prices consistent with their supply costs and environmental costs. The IMF estimates suggest that underpricing of fuels is common across the world, but much more significant in countries such as Russia, Indonesia, Turkiye and South Africa. While Russia, Indonesia, Turkiye have large explicit subsidies on fuels, South Africa has high implicit subsidies as a result of high environment costs that are not included in retail prices, which relate predominantly to coal as a fuel source.
