Egyptian Prime Minister Mustafa Madbouly has defended his government’s decision to sharply raise fuel prices, framing the move as an unavoidable step to keep factories running and prevent deeper economic turmoil as regional conflict drives up global energy costs.

Speaking at a cabinet meeting in Cairo, Madbouly said the government had been forced to choose between freezing fuel prices at great expense to the state budget or allowing an increase that would help safeguard industrial output, transport and essential services. He argued that shielding the economy from the fallout of the U.S.–Israel confrontation with Iran required difficult but calculated measures.

Authorities announced price hikes of up to 17 percent, with diesel – the backbone of Egypt’s public transport and freight networks – seeing the steepest rise. The Petroleum Ministry said the cost of a liter of diesel climbed by more than 17 percent, while 92-octane gasoline rose by about 15 percent and 95-octane by roughly 14 percent.

Madbouly insisted that, even after the increases, the state continues to shoulder “significant costs” to cushion consumers and businesses from the full impact of surging international oil prices. He described the current period as “exceptional circumstances” and stressed that the pricing decisions could be revisited once the regional crisis eases.

Egypt, the Arab world’s most populous nation, is heavily dependent on imported fuel, leaving it acutely vulnerable to external shocks. The latest escalation in the region has intensified pressure on an economy already strained by high inflation, a heavy debt burden and repeated currency devaluations.

The Egyptian pound has slid to record lows on the parallel and official markets, recently trading above 52 pounds to the U.S. dollar, eroding purchasing power and amplifying public frustration over rising living costs.

In an effort to contain the fallout, the government has announced a package of austerity-style measures, including curbs on official foreign travel, tighter controls on fuel consumption across state institutions and a renewed push to prioritize spending on essential imports.

Madbouly maintained that Egypt is better prepared to weather this crisis than previous shocks, citing recent reforms and support from international partners. Still, the fuel price hike is expected to ripple through transport fares and commodity prices, testing the patience of a population already grappling with years of economic hardship.