Peru Rolls Out Fuel Subsidy of Up to 20% to Calm Transport Strikes

Peru's President Keiko Fujimori introduced a fuel subsidy of up to 20% to ease tensions following transport strikes, which came into effect on 15 August 2026 and lasted for three months. The subsidy aimed to reduce fuel costs by 15% to 20% for truckers, bus lines, and river boats, particularly in the Amazon regions where fuel shortages were most acute.

The move was a response to soaring diesel prices, driven by global oil costs and shipping disruptions, which had led to protests and roadblocks in the region. Initially, the subsidy targeted diesel fuel for mass transport, benefiting river-boat operators and mototaxi drivers for the first time. Transport groups in Ucayali had initiated a strike on 10 August 2026 over the high fuel prices, leading to roadblocks and fuel station closures.

The government declared a fuel supply emergency in Ucayali, allowing operators to store extra diesel and gasoline to meet a seven-day fuel buffer. After negotiations, a deal was reached on 14 August 2026, with the strike's regional governor confirming the end of the protests. However, some groups continued to protest, and national transport guilds later issued a 48-hour ultimatum to the government over fuel prices and perceived extortion, warning of nationwide protests if demands were not met.

Fuel costs have significantly impacted Peru's cost of living, with vehicle fuel prices increasing by 17.8% in the past year. The Banco Central de Reserva had kept its key interest rate at 4.25% and was monitoring inflation, which remained near 4%, slightly above the central bank's target range of 1% to 3%.