| Summary: | Fossil fuel subsidy reforms are in fashion these days. The 2014 oil price collapse offers what has been called a ‘golden opportunity’ for cashstrapped governments around the world to phase out energy subsidies by taking advantage of lower fuel prices that reduce both the political cost of liberalizing energy prices and the risk of runaway inflation resulting from price reforms. More than two dozen governments have undertaken some form of fossil fuel subsidy reform since the beginning of 2014. The list includes India, Iran, and Indonesia, which are not only among the world’s largest energy consumers, but also some of the largest subsidizers of fossil fuels. As our colleagues Johannes Urpelainen, Keit Benes, Andrew Cheon, and Joonseok Yang explain in a new briefing paper (‘Low Oil Prices: An Opportunity for Fuel Subsidy Reform’) for Columbia University’s SIPA Center on Global Energy Policy, the three main barriers to fuel subsidy reform – popular opposition, vested interests, and low institutional capacity – are all reduced by low oil prices.
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