IMF Fossil Fuel Subsidies Data: 2023 Update

Globally, fossil fuel subsidies were $7 trillion in 2022 or 7.1% of GDP.  Explicit subsidies – the undercharging for supply costs – have more than doubled since 2020.  This equals 18% of the total subsidy, while nearly 60% is due to undercharging for global warming and local air pollution.  Differences between efficient prices and retail fuel prices are large, for example, 80% of global coal consumption was priced at below half of its efficient level in 2022.  Full fossil fuel price reform would reduce global carbon dioxide emissions (CO₂) to an estimated 43% below baseline levels in 2030 (in keeping with global warming to 1.5-2ᵒC).  It could raise revenues worth 3.6% of global GDP and prevent 1.6 million local air pollution deaths per year and lead the transition to clean energy.