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Cuban government announces 500% increase in gasoline prices

Yamil Lage Agence France-Presse A man fills the tank of his car at a gas station in Havana, October 2, 2023.

France Media Agency in Havana

January 8, 2024

  • Americas

The price of gasoline in Cuba will increase by more than 500% starting February 1, the government announced Monday, as part of a battery of economic measures intended to reduce the budget deficit .

The liter of regular gasoline will increase from 25 Cuban pesos (20 US dollar cents) to 132 pesos (+528%) and the price of premium will increase from 30 to 156 Cuban pesos (+520%) , announced the Minister of Finance and Prices, Vladimir Regueiro, on state television.

The authorities also announced that tourists will pay for gasoline in foreign currency.

The government, which subsidizes almost all essential goods and services, announced at the end of December a series of measures aimed at reducing the budget deficit, while the country is shaken by a severe economic crisis .

According to official estimates, the Cuban economy will shrink by 2% in 2023, while inflation has reached 30%.

At the end of December, the Minister of the Economy, Alejandro Gil, recognized that the government could not continue to sell fuel at “subsidized” prices, while the country, under American embargo, lacks cruelly in foreign currency.

“The country cannot maintain the price of fuel, which is the cheapest in the world when compared to prices in other countries,” he said.

This price increase “is aimed at purchasing fuel” and having “a stable supply,” added the Minister of Energy and Mines, Vicente de la O Levy, on Monday. on television.

“If we compare with the rest of the world […], gasoline is very cheap, but if we compare with salaries in the country, gasoline is very expensive” , economist Omar Everleny Pérez told AFP, for whom the new fuel price will affect “the whole of society”.

The government also confirmed on Monday a 25% increase from March in electricity for large consumers in residential areas, as well as an increase in the price of gas.

He also announced at the end of December that the Central Bank was analyzing “what the exchange rate should be against the dollar”, while the peso has already been devalued twice since 2021.

On the black market, the greenback was trading on Monday at 270 pesos, more than double the official rate (120 pesos to the dollar).

The island of 11 million inhabitants is experiencing its worst economic crisis since the fall of the Soviet bloc in the 1990s, due to the consequences of the pandemic, the strengthening of American sanctions for four years and structural weaknesses.

Teilor Stone

By Teilor Stone

Teilor Stone has been a reporter on the news desk since 2013. Before that she wrote about young adolescence and family dynamics for Styles and was the legal affairs correspondent for the Metro desk. Before joining Thesaxon , Teilor Stone worked as a staff writer at the Village Voice and a freelancer for Newsday, The Wall Street Journal, GQ and Mirabella. To get in touch, contact me through my teilor@nizhtimes.com 1-800-268-7116