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Japan floats surprise gasoline subsidy to cap prices at pump

Money for refiners risks distorting energy market in transition, critics say

Japan's gasoline prices hit a roughly seven-year high in early November amid surging crude prices and a weaker yen. (Photo by Munemasa Horio)

TOKYO -- Japan's government has proposed paying oil refiners to keep down the price of gasoline, just days after nations agreed to move faster to end "inefficient" subsidies for fossil fuels.

One proposal would offer refiners a subsidy of up to 5 yen per liter whenever retail prices top 170 yen, with the idea that the savings will be passed on to consumers. The average price for regular gasoline in Japan stood at a roughly seven-year high of 169 yen ($1.48) per liter on Nov. 8.

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