Governments across the world spent more than $400bn on fossil fuel subsidies in 2010, according to data released by the International Energy Agency (IEA) and the Organisation for Economic Co-operation and Development (OECD).

The IEA estimates that global subsidies rose by almost $110bn from 2009 levels. A study of 24 countries showed that 54 per cent of all subsidies were spent on gasoline.

Subsidies undermine economic growth and investment in renewable energy, says the IAE.

“In a period of persistently high energy prices, subsidies represent a significant economic liability,” said IEA executive director Maria van der Hoeven.

In a joint statement, the IEA and the OECD urged G20 leaders to follow up on a 2009 pledge to reduce subsidies.