Guatemala fuel subsidy nears end as prices stabilize internationally

Guatemala's Finance Ministry announced that 79% of the allocated funds for the temporary fuel subsidy have been disbursed. The measure, implemented to cushion the blow of rising international oil prices, has largely met its objectives of preserving economic activity and employment, according to Finance Minister Jonathan Menkos.

The state has spent an average of Q197.5 million weekly on the subsidy, totaling Q1.58 billion of the Q2 billion approved. This support has helped maintain economic growth expectations, with the Bank of Guatemala projecting a 4.1% growth for the year. Initial spending was Q175.5 million in the first week, peaking between May 4-10 with Q215 million, and most recently reaching Q185.8 million from July 15-21.

International oil price projections suggest a gradual decrease, with estimates of $70.44 per barrel for August 2026 and $66.41 for December 2027. The Finance Ministry believes this trend could allow economic activity to continue without the need for an extended subsidy. However, the final decision on ending the program rests with the Ministry of Energy and Mines (MEM), which is responsible for its execution and has a set end date of July 31.

The subsidy, approved by Congress in April 2026 as an emergency measure, offered a discount of Q8 per gallon for diesel and Q5 per gallon for gasoline. The MEM has been making weekly payments to distributors to ensure the benefit reaches consumers at the pump.