(Bloomberg) -- Truck drivers are blocking some of the main roads into Bogota to protest against Colombia’s first diesel price hike in nearly five years, forcing schools to cancel classes and leaving workers stuck in traffic.
With demonstrations against the government’s move entering a second day, television broadcasts and social media photos showed hundreds of cars and public buses at a standstill Tuesday in the capital and neighboring cities. Protests were also staged on highways in key industrial provinces such as Antioquia and Santander.
The office of Bogota’s mayor reported about 800 trucks blocking key areas of the city, affecting about half a million of users of the mass transit system.
President Gustavo Petro’s administration raised diesel prices by 20% to 11,360 pesos ($2.71) per gallon on Aug. 31 in a bid to phase out subsidies that make the fuel among the cheapest in Latin America. The finance ministry, which is under pressure to rein in spending, says the increase will save the government $380 million for the rest of the year and will add 0.3 percentage points to annual inflation that’s currently running at 6.86%.
Petro’s predecessor, Ivan Duque, froze diesel prices in 2020 just before the Covid pandemic hit and he kept them stable despite rising international market rates. State oil company Ecopetrol SA bore a large part of the burden, with its cash flow suffering as the government kept fuel prices artificially low.
The Colombian federation of freight transporters said the price of diesel shouldn’t rise because the nation is a producer of the fuel, arguing the government’s move will add pressure to the cost of food and other staples.
But Petro, whose administration has already lifted gasoline prices, defended its decision on the heavier fuel as fair.
“Providing food to hungry people and education to our children and youth requires us to lift diesel prices,” the president said in a post on X. He added that “appropriate measures” would be taken to deal with the business disruptions caused by the protest.
--With assistance from Andrea Jaramillo.
©2024 Bloomberg L.P.
