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| Caribbean-Latin America |
| Venezuela hikes gas prices for first time in nearly 17 years |
| 2016-02-18 |
| [BIGSTORY.AP.ORG] Venezuela's government is raising gasoline prices sixtyfold -- the first increase of any kind in more than 17 years as the country struggles with an economic collapse. Yet drivers will still be able to fill their tanks for pennies. President Nicolas Maduro announced Wednesday that he was increasing the price of gas as part of a series of measures designed to help with the falling price of oil, which makes up 95 percent of Venezuela's export earnings. He raised the price of 95-octane gasoline from .097 bolivars a liter to 6 bolivars per liter, and 91-octane gasoline from 0.07 bolivars to 1 bolivar per liter. The hike may have symbolic importance, but gas still remains virtually free in Venezuela. Calculated at the widely used black market currency exchange rate, the price per gallon will be a few U.S. cents. In contrast, a beer costs around 300 bolivars while a basket of strawberries costs about 800 bolivars. Maduro said the increased gasoline revenue will go to finance the government's social programs. The socialist president had been talking about hiking gas prices for more than a year. It's a touchy issue in Venezuela, where memories are still vivid from 1989 riots in Caracas that erupted after the proposal of a series of austerity measures including a hike in gas prices. |
| Posted by:Fred |
| #5 ^Wiki |
| Posted by: Shipman 2016-02-18 14:39 |
| #4 SS, during one their frequent refinery outages the actually imported finished gasoline from The Empire at market price and then gave it away. A form of Deadweight loss. Conversely, deadweight loss can also come from consumers buying a product even if it costs more than it benefits them. To describe this, let's use the same nail market, but instead it will be perfectly competitive, with the government giving a 3 cent subsidy to every nail produced. This 3 cent subsidy will push the market price of each nail down to 7 cents. Some consumers then buy nails even though the benefit to them is less than the real cost of 10 cents. This unneeded expense then creates the deadweight loss: resources are not being used efficiently. |
| Posted by: Shipman 2016-02-18 14:38 |
| #3 I'm impressed they still have gas to increase the price of. Hey, if you're looking for a steel mill, I know some Pakistani dudes who'll sell you one real cheap. |
| Posted by: SteveS 2016-02-18 09:39 |
| #2 Aren't they afraid of how this will impact inflation?~ |
| Posted by: Sven the pelter 2016-02-18 08:57 |
| #1 No food, growing unrest, global drop in gas prices... I've got it - let's increase the price of gas! |
| Posted by: Raj 2016-02-18 00:31 |