Fuel pricing in Jordan has undergone a profound transformation over the past two decades, reflecting both economic reforms and efforts to stabilize the national budget. The most significant shift came in 2008, when the government removed all subsidies on petroleum products, linking domestic fuel prices directly to international markets. This move was part of broader economic measures aimed at reducing fiscal pressure and directing support to those citizens most in need. Although occasional partial subsidies were introduced in subsequent years to soften the impact of global price spikes, by 2026, all direct subsidies had been eliminated, and fuel prices fully follow a flexible, market-responsive pricing formula.

In parallel with subsidy removal, Jordan reformed its taxation system on fuels. In July 2023, the government replaced the traditional percentage-based tax with a fixed excise tax applied per litre of each fuel type. This change was intended to simplify taxation, reduce the automatic increase in costs caused by rising international oil prices, and provide greater predictability for consumers. Each fuel type carries a fixed per-litre tax—95 fils for petrol (octanes 90, 95, 98), 25 fils for diesel, and 25 fils for kerosene. By stabilizing this element of pricing, the government ensures that fluctuations in world markets do not translate immediately into unstable domestic costs, while also maintaining a reliable revenue stream.

The pricing of fuels in Jordan is determined through a transparent, multi-stage formula managed by the Fuel Pricing Committee of the Ministry of Energy and Mineral Resources. This methodology begins with the global cost of crude or refined oil, converted to Jordanian dinars and adjusted for shipping, insurance, and delivery to the port of Aqaba. Domestic costs, including import fees, storage, distribution, and minor losses during transport, are then added. Taxes, the fixed excise, and marketing margins follow, ensuring distributors can operate sustainably. Finally, the committee reviews recent global price trends to determine the official monthly prices, ensuring both market responsiveness and economic stability.

The most recent update for March 2026 illustrates the practical effect of this system. Petrol 90 is priced at 0.820 JD per litre, Petrol 95 at 1.050 JD, diesel at 0.655 JD, kerosene at 0.550 JD, and a 12.5 kg cylinder of LPG at 7.000 JD. These prices reflect recent increases in international oil costs while demonstrating the stabilizing role of the fixed tax and pricing formula.

Economic analysts note that while the fixed excise tax provides some insulation against global volatility, high international oil prices continue to influence domestic costs significantly. Fuad Al-Katout, an economic expert, emphasized that the government has the tools to temporarily reduce or waive fuel taxes to ease the burden on citizens and critical sectors during periods of sharp price surges. He argued that such measures are not financial losses but strategic interventions to maintain economic continuity and protect purchasing power in times of crisis.

Over the past twenty years, Jordan has moved from broad subsidies to a market-linked approach with a fixed excise tax and a comprehensive pricing formula. This evolution demonstrates the government’s commitment to fiscal responsibility, efficient allocation of support, and protection of the domestic market against global oil volatility. Understanding these mechanisms is essential for both consumers and businesses, as fuel prices directly affect living costs, transportation, industry, and overall economic stability. Continuous transparency and timely updates remain crucial to ensuring confidence and adaptability in a rapidly changing global energy landscape.