Rajan Wilcox
Cuba has some of the cheapest fuel in the world, with petrol costing 11 cents per liter (42 cents per gallon) at the current black market exchange rate. However, this is a paradoxical situation as the local peso currency continues its freefall against the dollar, making fuel extremely expensive for Cubans who live on pesos alone. The Cuban government has been subsidizing fuel for decades, but in 2024, they announced a five-fold increase in fuel prices, causing concern among residents. This measure was implemented to tackle the country's economic crisis, but it has made life more difficult for cash-strapped Cubans, pushing the dream of car ownership even further away for many.
| Characteristics | Values |
|---|---|
| Price of octane-95 gasoline | 156 Cuban Pesos per liter |
| Price of octane-94 gasoline | 30 Cuban Pesos per liter |
| Price of gasoline in world currencies | 11 cents per liter (42 cents per gallon) or 20 US cents per liter |
| Comparison with other products | A half-liter of bottled water costs 100-200 pesos |
| Comparison with other countries | Cuba has the cheapest fuel in the world |
| Impact on locals | Filling a typical tank costs more than half the monthly minimum wage of 2100 pesos |
| Impact on tourists | Tourists will have to pay for fuel in foreign currency |
| Reason for price hike | To reduce the deficit and tackle economic crisis |
| Other price hikes | 25% increase in electricity prices and hikes in natural gas costs |
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What You'll Learn
Fuel prices in Cuba increased by 500% in 2024
Cuba has been experiencing an economic crisis, with shortages of food, medicine, and consumer goods. In January 2024, the Cuban government announced a sharp increase in fuel prices, with the cost of a litre of regular gasoline rising from 25 pesos (around 20 US cents or 11 cents on the black market) to 132 pesos. This represents a more than 500% increase in fuel prices, which came into effect on 1 February 2024.
The government, which has subsidised fuel prices for decades, stated that the price hike was necessary to reduce the country's deficit and address economic challenges. However, the move has caused concern among residents, especially those who rely on fuel for their livelihoods.
The impact of the fuel price increase was significant, given that Cuba's economy was already struggling. The country's economy shrank by 2% in 2023, and inflation reached 30%. The government also announced a 25% increase in electricity prices for major consumers and hikes in natural gas costs, further adding to the financial burden on residents.
The decision to raise fuel prices was made by the cash-strapped government as part of a series of economic measures. The finance minister, Vladimir Regueiro, stated that the country could no longer afford to sell fuel at subsidised prices, despite it being one of the cheapest in the world. The new prices were expected to affect "the whole of society," particularly those who depend on fuel for transportation and business operations.
The price increase also highlighted the inequality between those with access to dollars and those relying solely on pesos. With the peso's sharp decline, those with dollars had far more purchasing power for fuel, while Cubans earning only in pesos faced increased financial challenges. The government's decision to open 29 new petrol stations accepting only US dollars further emphasised the need to raise foreign currency to purchase fuel on international markets.
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Cuba's fuel is subsidised by the government
Cuba has been facing an acute fuel shortage since 2019, caused by US sanctions blocking oil shipments to the country. In 2024, the Cuban government announced that it could no longer sell fuel at subsidised prices due to the worsening economic crisis. This decision was met with backlash from the public, threatening to ignite social discontent.
Cuba's fuel prices have been heavily subsidised by the government for decades, since the early days of Fidel Castro's revolution. This has resulted in Cuban gasoline being one of the world's best bargains, with 94-octane gasoline selling for 30 pesos (11 cents) per liter on the black market, making it among the cheapest fuel globally.
The Cuban government's decision to end fuel subsidies was part of a broader austerity program called a "macroeconomic stabilization program." The program aimed to address the country's economic crisis, which has been characterised by widespread shortages, long lines for basic goods, and a sharp decline in the sugar industry's export earnings. The crisis has also led to a significant decrease in tourism revenues, with tourism to the island falling drastically since the COVID-19 pandemic.
The end of fuel subsidies has had a significant impact on the Cuban people. With the price of 94-octane gasoline rising from 30 pesos to 156 pesos per liter, filling up a typical tank now costs more than half the monthly minimum wage of 2,100 pesos. This has made car ownership even more unattainable for Cubans, as the rise in fuel costs adds to the existing challenges of food insecurity, inflation, and electricity blackouts.
While the Cuban government has faced criticism for its handling of the economic crisis, it has defended its actions by assuring Cubans that the measures are not neoliberal and are necessary to address the country's urgent situation.
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Cubans with access to dollars benefit from cheaper fuel
Cuba's gasoline is a bargain for those with access to US dollars. The local peso currency continues its freefall against the dollar, with the dollar soaring from a value of 170 pesos a year ago to 270 pesos on the black market. This gives those with dollars far more purchasing power for products like fuel, which are still tagged in pesos.
The price of octane-95 gasoline is 156 Cuban Pesos per liter. "Special" (94 octane) gasoline sells for 30 pesos, or 11 cents per liter (42 cents per gallon) at the current black market exchange rate, making it among the world's cheapest fuel. A typical half-liter of bottled water in Cuba, by comparison, sells for between 100 and 200 pesos, more than ten times the price of the same quantity of gasoline.
The Cuban government has long subsidized gasoline, since the early days of Fidel Castro's revolution. However, the government has recently announced a five-fold increase in fuel prices as it struggles with shortages and a deepening economic crisis. From February 2024, the price of a liter of petrol rose from 25 pesos ($0.20) to 132 pesos, a hike of over 500%. The government hopes this will help to reduce its deficit.
The rise in fuel prices is just one of a series of economic measures that will make life more difficult for Cubans, who are already facing food insecurity, inflation, and electricity blackouts. The new price structure will affect the whole of society, pushing the dream of car ownership even further away for most Cubans.
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The price of fuel in Cuba is high compared to salaries
Cuba's gasoline prices are considered a bargain, especially for those with access to US dollars. The local peso currency has been in freefall against the dollar, which has given those with dollars far more purchasing power for products like fuel, which are still tagged in pesos. For example, "special" (94 octane) gasoline sold for 30 pesos (11 cents per liter) at the current black market exchange rate in December 2023, making it among the world's cheapest fuel.
However, for Cubans who rely solely on pesos, the cost of fuel is much higher relative to their salaries. Filling up a typical tank costs more than half of the monthly minimum wage of 2,100 pesos. The peso's decline began in 2021 after the Cuban government announced a monetary reform that ended a dual-currency system, leading to a new black market exchange that has contributed to soaring prices.
In January 2024, the Cuban government announced a five-fold increase in fuel prices, with the cost of a liter of regular gasoline rising from 25 pesos (20 US cents) to 132 pesos. This was part of a series of economic measures aimed at reducing the country's deficit. The government, which subsidizes many goods, hoped that increasing fuel prices would help reduce its deficit.
Economics professor Omar Everleny Pérez noted that while Cuban petrol may be cheap by global standards, when compared to salaries in the country, it is "very expensive." The new price structure would affect "the whole of society," especially considering that few people own vehicles in Cuba. The rising cost of petrol pushes the dream of car ownership even further out of reach for most Cubans.
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Cuba's economy is in crisis
In December 2023, the Cuban government devalued the peso, which has been in a sharp decline since 2021, leading to a new black market exchange that has contributed to soaring prices on the island. The dollar value has soared against the peso, giving those with access to dollars far more purchasing power for products like fuel, which are still tagged in pesos. For Cubans who rely solely on their local currency, the cost of filling up a typical tank now costs more than half of the monthly minimum wage of 2,100 pesos.
In January 2024, the government announced a five-fold increase in fuel prices, with the cost of a liter of regular gasoline rising from 25 pesos (around 20 US cents) to 132 pesos, and premium gasoline jumping from 30 to 156 pesos. The government hopes that this will help to reduce its deficit and raise foreign currency to purchase fuel on the international markets. However, the new price structure will affect the whole of society, pushing the dream of car ownership even further away for most Cubans.
The fuel crisis comes on top of years of food insecurity, inflation, and electricity blackouts. Cuba, which depends heavily on imports, has suffered growing shortages of food, medicine, and consumer goods over the last four years. The government has also announced a 25% increase in electricity prices for major consumers in residential areas, as well as hikes in natural gas costs.
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Frequently asked questions
As of May 2025, the price of octane-95 gasoline in Cuba is 156 Cuban Pesos per litre.
As of 2023, fuel in Cuba costs 11 cents per litre or 42 cents per gallon at the black market exchange rate.
In 2023, a tourist from Italy filled up her rental car's tank with just three euros.
Cuba has subsidised gasoline for decades, since the revolution led by Fidel Castro. However, in 2024, the Cuban government announced a five-fold increase in fuel prices, citing economic struggles and shortages.
