petroleum overall, but what it exports is crude oil; because it has no refineries, it imports 100 percent of its petroleum product consumption. The IMF’s treatment of petroleum products in OECD countries is entirely different. If an OECD country levies taxes on petroleum products as reported in the IEA’s publication series _Energy Prices and Taxes_ , it is assumed to have no subsidies, and reference prices are taken as actual end-user prices net of taxes. Subsidies to producers are then taken from producersupport estimations calculated by the OECD. This approach misses the significant consumer price subsidies for petroleum products in Mexico, an OECD country.

Natural gas is the only fuel for which the IMF’s method is based only on price-gap measurements. For 37 countries, the results are taken from the IEA. There are four additional countries in the Middle East and North Africa (MENA), for which the IMF calculates subsidies. For these countries, average U.S. export prices published by the U.S. Energy Information Administration (EIA) are taken. For coal, the IMF takes subsidy estimations from the IEA for 39 non-OECD countries, and producer-support estimations from the OECD for another 16 countries. For electricity, the IMF takes the IEA’s calculations for 37 countries. For another 40 countries in Sub-Saharan Africa, MENA, and emerging Europe, hidden costs are used, which cover the entire electricity sector and not just electricity generated from fossil fuels. These include countries with hydropower as well as South Africa, which has nuclear power. Diesel consumption appears twice, first under the fuel category and second under electricity subsidies. The effect of this double-counting of diesel fuel subsidies where they exist is assumed to be small on account of the relatively small share of diesel used in power generation in most countries. For 31 out of the 40, the most recent year for which data were available was 2009. They were adjusted to 2011 by assuming that the same percentage of gross domestic product (GDP) had been spent on electricity subsidies in 2011 as in the year of calculation. Because hidden costs in the power sector can change markedly from year to year (Briceño-Garmendia and Shkaratan 2010:15 documents such variation in Kenya), this simplifying assumption could introduce large errors. The assumptions and data sources for the IEA and IMF are summarized in Table 4.

**Table 4 Assumptions and data sources for estimations by IEA and IMF**

|**Item**|**IEA**|**IMF pre-tax**|
|---|---|---|
|Exchange rates|Rates as reported by the IMF|Rates as reported by the IMF|
|**Petroleum produ**|**cts**||
|Type|Gasoline, kerosene, diesel, fuel oil, LPG|Gasoline, kerosene, diesel|
|Method|Price gap|Price gap for consumers in non-OECD<br>countries, producer support estimates<br>taken from the OECD for its member<br>countries|
|End-user prices|Data provided by large network of<br>country partners, regional organizations<br>such as OLADE, international<br>organizations such as GIZ and OPEC, and<br>commercial databases|For OECD countries, net-of-tax prices as<br>reported by the IEA, which also serve as<br>reference prices. For other countries, IEA,<br>IMF staff reporting, GIZ's biennial Nov<br>price surveys.|
|End-user price<br>by location|Regional prices in some countries, such<br>as India; otherwise country average<br>prices|Single price for the entire country except<br>where IEA prices are used|

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