A Saudi man walks past a pump at a petrol station yesterday in the Red Sea city of Jeddah.

DUBAI: Bahrain’s cabinet has approved a new pricing system for diesel and kerosene that is set to begin in January, state news agency BNA reported yesterday. The new pricing system is expected to result in a “gradual increase” in the cost of both fuels to domestic customers in the coming years, as Bahrain adjusts its prices to reflect expected rises in other Gulf Cooperation Council (GCC) states.

“Bahrain continues to preserve its competitiveness with the GCC even after the adjustment of prices in diesel and kerosene and will observe the gradual increase in diesel fuel and kerosene over the coming years,” said the statement, attributed to the kingdom’s energy minister, Abdul Hussein bin Ali Mirza. The pricing system comes after a detailed study with the relevant authorities and parliamentary committees in the kingdom “tasked with looking at subsidies and growing government revenues”, said the statement. The decision will benefit Bahrain’s national economy and, at the same time, preserve the interest of citizens, the statement added.

Meanwhile, the United Arab Emirates will lower domestic prices for gasoline and diesel in January, the ministry of energy said yesterday. The price of a litre of octane 95 gasoline will drop 6 percent to 1.58 dirham ($0.4302) at the start of January from 1.68 dirhams in December, the ministry said on its Twitter account. The domestic diesel price will fall to 1.61 dirhams in January from 1.83 dirhams in December, the ministry said. In July, the UAE said it was shifting from a system of fixed, subsidized fuel prices to adjusting prices monthly in response to global trends. It did not reveal details of its new formula nor say whether subsidies would be removed entirely, but announced that fuel prices would be “based on the average global prices with the addition of operating costs”. – Agencies