Fuel price increase worsens violence in Haiti

A steep rise in fuel prices has led to intensified street protests in Haiti where shortages have been stoking unrest that has troubled the country in recent years.

The increases implemented yesterday are the result of the government's decision to end state subsidies to private-sector fuel importers, saying the state's finances could no longer be used to control prices.

The subsidies have been costing the government about $420mn/yr, prime minister Ariel Henry said.

The fuel shortage is caused by importers' difficulties "in having quick access to US dollars," petrol station owners' federation Anapross said.

"The American currency is not only expensive, but also increasingly rare," it said, pointing to a 33pc depreciation of the Haitian gourde since January.

The ending of the subsidies has led to the price of gasoline more than doubling to $4.78/USG, while diesel and kerosene have been increased by 90pc to $5.60/USG and $5.57/USG, respectively.

The shortages have also caused a growing illegal market that is being manipulated by armed gangs that control parts of the capital Port au Prince and other towns.

It has also led to increased smuggling of fuel from the Dominican Republic that shares a common border with Haiti, the Dominican government and Anapross said.

The fuel shortage has also affected the operations of independent power producers that burn diesel and state-owned power utility EdH that backs up its hydropower plants with oil-fired generators.

Haiti produces no crude and has no refinery, and fuel shortages have sparked street violence since 2018 when the country stopped receiving supplies under Venezuela's now defunct regional oil program PetroCaribe.

Under PetroCaribe, Venezuela's state-owned oil company PdV provided several Central American and Caribbean countries with crude oil and refined products, allowing them to pay a fraction of the cost while keeping the rest as long-term low-interest loans.

The country now imports products from the US to meet demand of 60,000 b/d, according to official figures. But imports are sporadic because of a lack of foreign currency to pay suppliers.

The protests have crippled commercial life in the capital and other major towns where roads have been blocked, public transportation is limited and increasingly expensive.

Henry promised on 13 September that he would ensure adequate fuel, without indicating how he would do this.

"This country has many problems, and everyone should remain calm," he said. "We are doing all we can to solve the problems."

By Canute James