June 17, 2024

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Due to the economic crisis, Cuba will increase the price of gasoline

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Starting on February 1, the government of the island announced today that the cost of gasoline in Cuba will experience an increase of over 500%, as part of a set of measures aimed at reducing the significant fiscal deficit. The Minister of Finance and Prices, Vladimir Regueiro, announced in a state television broadcast that the price per liter of regular gasoline will rise from 25 Cuban pesos (0.20 US dollars) to 132 pesos (1.10 dollars), implying an increase of +528%.

INCREASE IN RATES DUE TO THE ECONOMIC CRISIS IN POST-PANDEMIC CUBA AND U.S. SANCTIONS

The official also indicated that the price of special gasoline will increase from 30 (0.25 US dollars) to 156 Cuban pesos (1.30 dollars), equivalent to a +520% increase. Additionally, authorities have stipulated that foreign tourists will pay for fuel in foreign currency. The Minister of Energy and Mines, Vicente de la O Levy, invited to the television program, explained that this increase aims to ensure fuel supply and maintain stable provisioning. In Cuba, a 25% increase in electricity rates for the highest-consuming sector was also announced from March 1. Minister de la O Levy stated that the electricity rate will continue to be subsidized despite this growth, with the goal of promoting savings.

These increases are compounded by the rise in the liquefied gas bill. The government, which subsidizes almost all basic services and goods consumed by Cubans, outlined a series of measures in December to reverse the economic crisis facing the country, due to the effects of the pandemic, the intensification of sanctions imposed by Washington, and internal distortions in its economy. Cuba closed 2023 with a contraction of the gross domestic product (GDP) of up to 2%, according to the government, and a fiscal deficit equivalent to 19% of the GDP. Official inflation will exceed 30%, according to their calculations.

CUBA’S POPULATION WILL BE AFFECTED BY THE GASOLINE HIKE

The government admitted in late December that it was unsustainable to continue selling fuel at subsidized prices. “The country cannot maintain the price of fuel, which is the cheapest in the world when compared to the prices of other countries,” said Alejandro Gil, Minister of Economy. According to economist Omar Everleny Pérez, these measures will hit the ordinary citizen. “If you compare it to the world, which is how they (the government) always want to compare themselves, gasoline is very cheap, but if you compare it to the country’s salary, gasoline is very expensive.”

Published by Iraic.Info, news and information agency.

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