The high volatility in the price of a barrel of oil benchmark Brent, which has been above US$100 in the last month (derived from the Russia-Ukraine war), should have triggered prices of liquid fuels in the country.
(Inflation, oil and a distant war hit Latin Americans).
On the other hand, the rate in the gallon of gasoline, as well as that of diesel, has remained stable between January and Marchwhich has allowed its consumption to remain affordable for Colombians.
“The country has the Fuel Price Stabilization Fund (FEPC) which is a mechanism to protect the end user from the high volatility in international oil prices. On the first day of January, the last gradual increase in liquid fuel rates was made, which has remained stable in the first three months of this year,” explained Diego Mesa, Minister of Mines and Energy.
The official stressed that the Fund is important because it protects the consumer since it stops fuel increases, and guarantees that there is stability in the distribution market in the national territory.
(Value of the Ecopetrol share, close to the maximum of 3 years ago).
“There is an inflationary context in the world, and if the prices of gasoline and diesel increase, as has been registered in other countries of the world, there would be a high impact on freight, on the transport of food cargo and on goods, which would lead to a higher cost of living,” said Mesa.
And it is that the FEPC has been so effective to regulate the prices of liquid fuels in the country, that to date the rates of gasoline and diesel are some of the cheapest on the continent.
According to the Global Petrol Prices portal, Colombia has the third cheapest gasoline in Latin America, since as of this Monday, March 28, the average cost for the country is US$2.37 per gallon, after Venezuela (US $0.09/gallon) and Bolivia (US$2.06/gallon), and above Ecuador, which registers US$2.55 per gallon.
In the case of the price of diesel, the country has the fourth cheapest rate (US$2.33/gallon) after Venezuela (US$0.09/gallon), Ecuador (US$1.90/gallon) and Bolivia (US$2 .05), and above Paraguay (US$3.29).
For analysts consulted by Portafolio, it is understandable that in an extraordinary price situation like the current one, the Executive intervenes to guarantee better volatility, and a greater price stability and lesser effects on consumers and in general in the economy via inflation.
“The Government made the decision not to transfer the variation in the international price of oil and fuels to the domestic price, and for this it has stabilized the price using the FEPC”, pointed out Julio César Vera, president of the Xua Energy Foundation.
The analyst explained that the price differential today to maintain fuel rate stability is approximately $5,000 for gasoline and almost $7,000 for diesel, if one takes into account that 6.7 million gallons are consumed per day for the first fuel, and 5.8 million gallons per day for the second.
ALFONSO LOPEZ SUAREZ
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