Honduras faces economic strain from rising fuel prices

Honduras is facing significant economic pressure due to sharp increases in fuel prices. Between January and October 2026, diesel prices in Tegucigalpa rose by 82%, while regular gasoline increased by 53%. Kerosene saw the highest percentage jump at 88.44%.

These rising costs are driving inflation in essential sectors, with food and energy prices showing a 10% year-on-year increase in August. The country's heavy reliance on fuel imports exacerbates the situation; in 2025, fuel imports cost $2.38 billion, representing 5.9% of the national GDP.

To mitigate the impact, the government has implemented temporary subsidies, including a 12.01 lempira per gallon support for diesel and a 70% support measure for regular gasoline increases. However, experts warn these measures create a significant fiscal hole. Maintaining diesel price freezes could result in a fiscal loss of approximately L3.7 billion over one year.

Economists are calling for austerity measures, including reducing public spending on advertising, implementing teleworking for public employees to lower fuel consumption, and addressing the annual L10,000 million losses at the national energy company (ENEE).