Gas: Almost $2/gallon

When I arrived in 2008 I appreciated the price of gas in the Emirates. In Iowa it was at $4/gallon and in the Emirates it was $1.35/gallon. Unlike the US where gas prices change as the price of oil changes, gas in the Emirates remained $1.35/gallon. This spring they upped the price twice and plan to do so again. The new price will be $1.97/gallon.

The Emirates is a perfect example of the effect of government subsidies: They lead to excess use. The number of SUV's and other gas guzzlers is much higher. With the price going up it will be interesting to see if the ratio of SUV's declines.

While I know the detrimental impact of subsidies I find myself hoping they don't cut the electricity subsidy. I like being cool and not feeling guilty for running up a big bill.