Egypt’s petroleum subsidies bill dropped 29% to EGP51bn in FY15/16, which ended in June, according to the Minister of Petroleum Tarek El Molla, marking a greater decline than previously reported. The head of state oil company EGPC Tarek al-Hadidi had told reporters in August that the subsidies had fallen 23% to EGP55bn for the same fiscal year. The state's FY16/17 budget aims to reduce subsidy expenditure further, targeting EGP35bn. We note the decline entirely reflects lower oil prices in the absence of any fuel subsidy cuts during the year. We forecast fuel subsidies will rise Y-o-Y in FY16/17 to cEGP60bn, assuming a weaker USD-EGP than budgeted. (Reuters, Mohamed Abu Basha)