UNDP report: Global energy subsidies could reach $1 trillion by 2026

A new report from the United Nations Development Programme (UNDP) warns that global energy subsidies could exceed $1 trillion by 2026. This surge is driven by ongoing conflicts in West Asia, rising oil prices, and widespread economic uncertainty.

To mitigate the impact of rising fuel and food costs, governments are increasingly utilizing large-scale subsidies, price caps, and tax concessions. However, the report notes that maintaining these measures is becoming difficult due to high interest rates, expensive debt, and climate-related risks. With crude oil prices approaching $100 per barrel, many nations are facing significant pressure on their public finances.

Data from the World Bank, IMF, and International Energy Agency indicates that the number of countries adopting relief measures nearly doubled between April and September. While these government assistance programs helped prevent an estimated 130 million people from falling below the $6.85 daily poverty line this year, they have placed a heavy burden on national budgets. UNDP Chief Economist Jorge Gra Molina stated that the coming months remain uncertain as the world faces multiple simultaneous crises.