Over the past five months and two weeks, the Dominican government reports it has spent above RD$27 billion in subsidies to maintain the price of fuels at the same levels of 9 March 2022, despite recent crude oil prices highs. In past weeks, the cost of a barrel of fuel had reached US$130 a barrel. Currently, the latest market close is slightly below US$90/bbl.
Back in March, President Luis Abinader told the Dominican people that the government would maintain the fuel price steady as long as a barrel of crude oil (WTI is the crude of reference in the Dominican Republic) was between US$85 and US$115 per barrel. He kept prices the same even when the price of crude was reaching US$130 a barrel.
As a result, the government says it has spent, at times, close to RD$2.0 billion per week just to keep the prices from increasing. In July 2022, crude prices started to go down, and so did the government subsidies: from RD$1.7 billion a week to “just” RD$660 million per week. And even more recently, the subsidy for this week is said to be only 300 million.
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El Caribe
22 August 2022