Fuel tanker truck parked next to a gas station in Bolivia. Photo: EFE.
Fuel prices in Bolivia, stable for over 19 years, have fallen far below regional averages. To sustain these prices, the state has increasingly relied on subsidies.
The country with some of the hemisphere’s cheapest gasoline is now working to address diesel shortages and navigate rising international oil prices. In response, President Luis Arce’s government has authorized private businesses to import fuel and redirected subsidies to the sector.
Bolivia is confronting a fuel supply crisis marked by diesel scarcity and surging global oil prices.
This Tuesday, two major highways in Santa Cruz remained blocked since Monday in protest of the diesel shortage, with demonstrators threatening a strike by Friday. Farmers leading the protests are demanding government guarantees for fuel supplies to avoid losses during the summer harvest.
Meanwhile, transportation unions report that only 35–40% of urban transit in the region is operational, while intermunicipal and interdepartmental services face critical disruptions, operating at just 40–50% capacity.
This crisis unfolds amid broader economic challenges, opposition maneuvers in an election year, and legislative gridlock blocking many of the executive branch’s initiatives. Despite this, the Arce administration is advancing a series of short- and long-term measures to address the situation.
Government response
In response to the crisis, the Bolivian government has implemented measures to ensure supply and mitigate public impact.
Economy Minister Marcelo Montenegro confirmed last Thursday the sale of an unspecified portion of the 14.5 tons of gold purchased by Bolivia’s Central Bank in 2024, originally intended as international reserves.
“This measure has not yet allowed us to increase [fuel] reserve stocks,” Montenegro explained, “but it has enabled us to purchase gasoline and diesel.”
President Luis Arce also ordered guaranteed fuel supplies for the agricultural sector ahead of the intensified grain harvest season starting March 10, according to Deputy Communications Minister Gabriela Alcón.
Meanwhile, the hydrocarbons minister announced that Bolivia has begun importing fuel from neighboring countries and secured international agreements to ensure short-term supply.
Private-sector fuel imports have also been authorized. Per the Ministry of Hydrocarbons and Energy, 44 companies are now approved to import fuel for internal use, while 4 are authorized to import and sell it commercially.
However, Hydrocarbons Minister Alejandro Gallardo noted, “From these 44, import volumes remain minimal—just 2,000 cubic meters last month.” He added that sectors demanding fuel market liberalization still prefer buying state-subsidized fuel.
Factors behind the crisis
Minister Gallardo attributed the crisis to the Legislative Assembly’s “strangulation” of over $1.667 billion in external financing loans.
“For 26 months, funding has been blocked by the Assembly. We’re like a plane flying with one wing,” Gallardo said, referencing loans frozen by a legislature where the ruling party lost its majority, due to a split within the MAS-IPSP party led by former President Evo Morales.
Globally, Bolivia’s fuel crisis coincides with soaring oil prices and volatile international markets. Domestic factors include limited refining capacity and rising domestic fuel demand.
In recent remarks, the hydrocarbons minister said that “the situation is complex, but we are working to ensure Bolivians do not face shortages.” He added that alternatives to diversify energy sources and reduce fossil fuel dependence are under evaluation.
Long-term plans
Beyond immediate measures, the government has announced long-term strategies to avert future crises, including:
• Investment in refining infrastructure.
• Promotion of renewable energy.
• Energy source diversification.
• Strategic alliances with other countries to bolster energy security are also being explored. These efforts are part of a comprehensive strategy to ensure mid- and long-term fuel supply stability.
(Telesur)
Translation: Orinoco Tribune
OT/JRE/SA
