Bolivia's fuel subsidy elimination sparks major protests

Bolivia's government hiked gasoline and diesel prices after eliminating fuel subsidies, triggering the first major protests against centrist President Rodrigo Paz, who took office last month.

Transport workers Dec. 19 began a strike and blocked roads to the capital, La Paz, while mining workers and the Bolivian Workers Union (COB) both announced indefinite strikes to pressure the government to overturn Supreme Decree 5503, which eliminates subsidies for gasoline, diesel and LPG.

President Paz, a 58-year-old economist who won October elections on a pledge to stabilize Bolivia's ailing economy, this week doubled regular gasoline prices to $1/liter and diesel to $1.40/ liter, claiming fuel subsidies were costing Bolivia $10 million/day.

"The COB will join the protests until the ultimate consequences. This decree has wiped the smile off people's faces this Christmas," union general secretary Mario Argollo said at a broadcast press conference. "We're going to ask the people to join the effort to overturn this damned decree."

Decree 5503 aims to reallocate funds to jumpstart state oil company YPFB's 24,000 b/d Guillermo Elder Bell and 39,750 b/d Gualberto Villarroel oil refineries, which are operating at 30% of capacity, according to the Energy Ministry.

YPFB, which owes $600 million to international traders and local suppliers, has faced severe fuel shortages in recent years after the country's Central Bank ran out of hard currency and Congress blocked access to credit lines.

"These roadblocks only seek to hinder us just as we're starting to put the house in order," Finance Minister Jose Gabriel Espinoza said via Twitter. "Decree 5503 will be maintained because it's a serious and optimistic signal for the future."

President Paz's election victory in October ended two decades of statist policies during which oil and natural gas fields and refineries were nationalized and private investment dwindled. Crude production is expected to decline to 3,200 b/d by 2029 from 4,000 b/d last year due to lack of exploration.

Bolivia, which mainly supplies natural gas to Brazil, saw hydrocarbons export revenue drop 35% on the year to $860 million through the first three quarters of 2025, according to the Bolivian Foreign Trade Institute.