Fuel Crisis, Calls for Shock Reforms | Crisis de Combustibles, Reformas de Choque

By Lourdes Molina, El Deber:

Former Minister Ríos Suggests Ending Fuel Subsidies and Reforming Hydrocarbons Law to Solve Supply Crisis

Exministro Ríos sugiere quitar el subsidio a los combustibles y modificar la ley de hidrocarburos, para solucionar el abastecimiento en el país

Two weeks after all roadblocks from the 53-day conflict were lifted, long lines of vehicles continue at gas stations across Bolivia in search of fuel.

Former Hydrocarbons Minister Álvaro Ríos believes the only lasting solution to the country’s fuel shortage is to eliminate fuel subsidies and reform existing energy regulations.

“The only way to solve this fuel scarcity is to remove subsidies on gasoline and diesel and allow prices to follow international oil markets. We must also eliminate subsidies on natural gas and LPG, while targeting support only to the most vulnerable families,” Ríos said Tuesday on ON–Otra Noche con Sissi, a program broadcast by El Deber.

According to Ríos, Bolivia also needs a new hydrocarbons law that encourages exploration and investment to prevent similar shortages over the next decade.

“If we do not remove subsidies, we cannot create a hydrocarbons law that promotes exploration. We need to eliminate subsidies, pass a hydrocarbons law that attracts investment, enact an electricity law, open the sector to private capital so it can import fuel in competition with YPFB, and then restructure YPFB. That company is a giant that exerts enormous influence, and I have said many times it will continue to cause problems,” he stated.

Background

Although the road blockades ended two weeks ago, fuel shortages persist and motorists continue to face lengthy waits at service stations.

The leadership of Bolivia’s Confederation of Drivers expressed frustration over the situation on Tuesday.

“We were held hostage for 53 days. We came out of that conflict only to face more kilometer-long lines throughout the country to obtain fuel,” said union leader Lucio Gómez.

The organization demanded that the government “tell the truth” about the fuel situation and gave authorities 48 hours to provide clear answers regarding the ongoing shortages.

Proposed Solution

Ríos acknowledged that his proposal runs counter to the position of the Bolivian Workers’ Central (COB) regarding fuel prices. However, he argued that “Bolivians must finally demand that the government secure the dollars the country needs while it removes subsidies and implements the reforms I am proposing, so that within two or three years we can hopefully have new domestic production.”

The former minister described the current situation as highly critical and warned that it is not receiving the attention it deserves. “When the crisis becomes truly severe and we end up in a situation like Cuba’s, it will be much harder to climb out of the hole,” he said.

Leave a comment