Cubans will face a 500 per cent surge in the fuel price from February, the biggest single increase on the island in decades.

Key points:

· A litre of regular petrol will rise from 25 pesos (29 cents) to 132 pesos ($1.53)

· The average Cuban salary is about $60 a month

· Cuba is experiencing its worst economic crisis since the collapse of the Soviet bloc in the 1990s

The cost of a litre of regular petrol will rise from 25 pesos (29 cents) to 132 pesos ($1.53), while the price of premium will jump from 30 to 156 pesos, the government said.

Australia's national average last week was $1.85 a litre, according to the Australian Institute of Petroleum.

To buy 10 litres of fuel for his motorbike, enough for a week, building guard Domingo Wong said he would now have to fork over half his monthly salary of about $31.

"Ten litres is what I use in a week without doing anything special, just the daily: going to work, bringing my daughter to school, visiting my sister," he said.

The average Cuban salary is the equivalent of about $60 per month.

The communist-run government says the February 1 price rise is necessary to control deficit spending and raise funds for imports of food, medicine and critically — more fuel.

 

A man fills up a jerry can at a Cuban petrol station, as the government announced it will hike prices.(Reuters: Yander Zamora)

The nation of 11 million people is experiencing its worst economic crisis since the collapse of the Soviet bloc in the 1990s.

That's due to consequences of the coronavirus pandemic, the tightening of US sanctions in recent years, and structural weaknesses in the economy.

According to official estimates, the economy shrank by 2 per cent in 2023, while inflation reached 30 per cent in 2023. Independent experts say this is likely an under-estimation.

Fuel and other basics are already hard to come by.

Cuba's government, which subsidies almost all essential goods and services, already intimated last month it would have to increase fuel prices.

"The country can not maintain the price of fuel, which is the cheapest in the world," Economy Minister Alejandro Gil said.

The government on Monday also confirmed a 25 per cent rise in the price of electricity for major residential consumers, as well as an increase in the price of natural gas.

Many Cubans fear even worse inflation

Motorbike taxi driver Rafael Olivier said prices in general will increase.

"Even the food we eat depends on transport," he said.

Javier Vega, a 33-year-old driver for a ride-hailing company, said he feared the effect on trip prices in a country where public transport is already limited due to a shortage of fuel and car parts.

Energy Minister Vicente de la O Levy said the price hike was exactly meant to curb shortages, "to buy fuel" and have "a stable supply".

Authorities also announced tourists will now pay for fuel in foreign currency, also in short supply, and said the central bank was considering adjusting the exchange rate against the dollar.

The peso has been devalued twice since 2021.

Economist Omar Everleny Perez said fuel may be cheap in Cuba compared to the rest of the world, "but if you compare it with salaries in the country, it is very expensive".

Worker Juan Antonio Cruzata said: "Our purchasing power is not enough, it will affect all of us."