Oil-rich Venezuela has the world’s cheapest gasoline. But it’s also dealing with the world’s worst economic crisis. So desperately cash-strapped Venezuelans are about to pay a lot more at the pump.
In Venezuela, gasoline is cheaper than water. Literally. Gas is heavily subsidized there – and hyperinflation has made the currency, the bolívar, worthless. So in dollar terms a bottle of water costs more in Venezuela than a tank of gas.
But the government gasoline subsidies are no longer sustainable as Venezuela’s economy keeps collapsing. And Venezuela loses billions of dollars to smugglers who sell the gas in neighboring countries at huge profits.
So socialist President Nicolás Maduro has announced he’s returning gasoline to market prices.
But, like everything in Venezuela today, there’s a political twist.
Subsidies will remain a while for Venezuelans who’ve gotten so-called “Fatherland ID” cards. Critics say the new IDs are simply a Big Brother device for keeping track of who’s loyal to Maduro’s authoritarian regime – and who isn’t.
Those who don’t have the “Fatherland IDs” will feel the shock of the new gas pricing. That will be one more hardship in a country with crippling shortages of food, medicine and other basics.