Colombia to See Gasoline Price Reduction Starting February, Government Confirms
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Colombia’s national government is poised to lower gasoline prices for consumers beginning February 1st, a move welcomed by industry stakeholders and spurred by a shift in market dynamics. After maintaining prices above international levels since 2024 due to adjustments aimed at closing a significant price gap and addressing a shortfall in the Fuel Price Stabilization Fund (Fepc), conditions have changed, allowing for a potential decrease without reinstating subsidies.
According to a researcher in the mining-energy sector, the country currently pays approximately $3,000 more per gallon than the international market rate. The average gasoline price in Colombia currently stands at $16,057 per gallon, creating a potential reduction margin of up to $3,000.
President Gustavo Petro’s announcement was officially confirmed by the Minister of Mines and Energy, Edwin Palma Egea. While the exact amount of the price reduction remains under discussion with the Ministry of Finance, Palma Egea assured the public that the president’s commitment will be realized through a “gradual and progressive decrease, designed to take care of the country’s economy and the people’s pockets.”
Impact on Consumption Expected
The anticipated price drop has been met with optimism from the fuel industry. Farid Jhoany Jones Zárate, executive director of the Federation of Biofuels and Energy Entrepreneurs of Colombia (Febecol), anticipates a surge in gasoline consumption. “A price reduction should result in increased gasoline consumption,” Zárate stated, predicting a potential increase of 5% to 6% depending on the final reduction amount. Industry expectations currently point to a price decrease between $500 and $600 per gallon in February.
Why are Gasoline Prices Falling in Colombia?
The shift towards lower prices is largely due to a reversal in the relationship between domestic and international gasoline prices. Since mid-2023, internal prices have exceeded international values, allowing gasoline to contribute to the Fepc fund rather than drawing from it. This contribution is now helping to offset the subsidy gap for Acpm (diesel).
One expert recalled that gasoline prices have risen from around $9,000 in 2020 to $16,500 in 2025. However, a combination of factors – including a decline in international prices, an appreciation of the Colombian peso, and ongoing internal adjustments – could bring the price per gallon down to $13,000. “With the recent drop in the international price, the appreciation of the TRM and the continuity of the internal adjustment, the possibility of reducing the price to levels close to $13,000 per gallon opens up,” the expert explained. In Bucaramanga, for example, the current price of $16,248 per gallon hasn’t been near $13,000 since August 2023.
Diesel Prices and the Acpm Fund
While gasoline prices are falling, the situation with diesel (Acpm) is more nuanced. The price of Acpm has seen slight increases in recent years to address the Fepc gap, but a subsidy remains in place due to the difference between domestic and international prices. Currently, a gallon of Acpm costs around $10,984.
According to the same expert, falling international prices, a stronger peso, and government adjustments are closing the diesel subsidy gap, creating a margin of approximately $756 per gallon. To further address the Fepc gap, the Petro government has also decreed a differential rate, charging private vehicle owners the international price for Acpm, while exempting public and cargo transportation.
The anticipated reduction in gasoline prices represents a significant development for Colombian consumers and the energy sector, signaling a potential shift towards more stable and affordable fuel costs.
