CARACAS Aug 5 Venezuela will raise gasoline
prices, the country's oil minister told reporters on Tuesday,
repeating a government promise to increase the world's lowest
fuel prices for the first time in two decades.
Oil Minister Rafael Ramirez did not give a timeline for the
increase, but said it would not be comparable to international
According to government figures, cheap fuel costs the
gasoline subsidiary of state-run oil company PDVSA $12.5 billion
in losses annually.
Efforts to raise the price of fuel in Venezuela, which has
the highest inflation in the Americas, reaching 60.9 percent
year-on-year in May, have been delayed several times.
"We will not put on the international price because that's
not the idea, but it will be a price which is reasonable," said
Ramirez, who was attending a celebration of the centenary of the
discovery of oil in the Caribbean country.
"There has to be a discussion (about the price rise). It is
cheaper to fill a tank than to buy a cigarette," said the
minister, who is also president of PDVSA.
A full tank of 91 octane gas for a small vehicle costs
about 38 cents in Venezuela, four times less than a medium-sized
bottle of water.
A liter of 95 octane gas sets buyers back only 0.097
It costs PDVSA 28 times more to produce gasoline than its
sales price. For diesel, the production costs are 50 times what
consumers pay at the gas station.
"We are the country with highest gas consumption per capita
and we have the lowest gas prices in the world. It can't be
justified," said Ramirez.
Raising fuel prices is a sensitive subject for Venezuela,
which has the largest crude reserves in the world.
Thousands protested and hundreds were killed in clashes in
the early 1990s when the government doubled gas prices and
pushed public transport costs up 30 percent.
(Reporting by Deisy Buitrago. Writing by Diego Ore and Julia
Symmes Cobb. Editing by Andre Grenon)