Elimination of Fuel Subsidies and Distortions in the Energy Market in Bolivia

In Bolivia, the fuel subsidy fulfilled its task of stabilizing prices for more than 30 years and has formed the central pillar of Bolivian economic policy, guaranteeing access to supply to the vehicle fleet and its productive apparatus with low inflation. In recent years, the import and subsidization of fuels has been affected by intermediation, smuggling and overpricing, which has led to macroeconomic instability of dollar illiquidity and inflation, aggravating inequalities in a context of dependence on sales of raw materials, greater indebtedness and labor informality, leading to the elimination of fuel subsidies. In this understanding, the objective of this research is to identify, analyze and determine the prices with and without subsidies in the import of fuels, considering the intermediation of the purchase and the distortions in the market in Bolivia between official prices, real demand and smuggling, through the historical data of the annual budgets, with a sample of a decade from 2014 to 2025 where they affected the sustainability of fuels. in the end, passing on to citizens the rise in prices through the elimination of the subsidy, the instability of fuels and supply.