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Dubai Denies Neighbors Fuel in Struggle to Pay Debt: Arab Credit

Dubai, the second-largest of seven sheikhdoms in the United Arab Emirates, has stopped supplying gasoline to its neighbors as subsidies on fuel prices squeeze the city’s ability to service and repay debt.

Emirates National Oil Co., a Dubai government-owned refiner and operator of service stations, closed filling points in neighboring Sharjah and restricted supplies to other northern emirates last week. Dubai has $16 billion of publicly held debt maturing later this year, International Monetary Fund data show. The emirate plans to cut “subsidies and transfers” by 50 percent to 2.67 billion dirhams in 2011 from a year ago, according to a government forecast.