The gasolinazo as the price hike is known came as long queues of cars were already forming at pumps due to fuel shortages, and has led to violent protests

Demonstrators have blockaded highways, looted shops and forced service stations across Mexico to close in a wave of angry protest triggered by a hike of more than 20% in the government-set price of gasoline.

The announcement of the price increase came on 1 January when long queues of cars were already forming at pumps because national oil giant Pemex was unable to supply all gas stations due to problems with oil refining and fuel shortages caused by theft.

The so-called gasolinazo as the price hike is known added insult to injury, and since then, protests have spiraled. Truckers, taxi drivers and irate individuals have blocked the main highways into Mexico City and major thoroughfares in the capital, prompting bus lines to cancel service.

Pemex warned on Tuesday that blockades had created a critical situation in at least three Mexican states, while demonstrations in suburban Mexico City turned violent as protesters looted at least two department stores.

Outside one gas station in the centre of the captial, Manuel Lpez, a mechanic, stood defiantly in front of the pumps. Ironically, Lpez does not own a car he sold it because of Mexicos ongoing economic downturn but he said the size and shock of the gasolinazo had sent him into the streets.

Its an economic issue, said Lpez, 24. Salaries are not very good. If gasoline goes up, it provokes an inflation in the cost of the items we consume daily, he added, reciting a list of common complaints among Mexicans. The first thing that gets hit are peoples pocketbooks.

Residents
Residents steal gasoline and diesel from a gas station following protests against an increase in fuel prices in Allende, southern Veracuz State, Mexico Tuesday. Photograph: Erick Herrera/AP

The timing of the protests could prove particularly troublesome as Mexico prepares for the impact of US president-elect Donald Trump and his promises to pull out of the North American Free Trade Agreement (Nafta) and build a wall on the northern border moves economists warn will throw the country into recession.

G500, the operator of 1,800 petrol stations, warned that all of its outlets could close due to potential insecurity.

Some protesters said pocketbook issues and displeasure with their own politicians causes more consternation than anything proposed by Trump.

We wouldnt have to worry about Donald Trump if were a stable economy, said Ivn Rosales, a protester and trucking company employee. Corruption here is whats killing us.

The outrage appears to be boosting the fortunes of populist presidential candidate Andrs Manuel Lpez Obrador, who leads polls for the 2018 election and has promised to lower the price of gasoline and electricity and build five new refineries.

Officials say the price increase to 15.99 pesos a litre in Mexico City ($0.75) is necessary to cover shortfalls in the federal budget, which traditionally depends on oil revenues. Prices at the pump will vary across the country and be set on a daily basis in the future.

Environment secretary Rafael Pacchiano defended the gasolinazo on Twitter, saying the federal government couldnt continue to subisidise gasoline, which mostly benefits rich SUV owners. Higher prices, he added, would encourage the use of green energy in Mexico.

Cheap gasoline has caused other consequences including a spike in automobile ownership, which has in turn contributed to severe traffic congestion and an associated rise in air pollution.

We (had) a situation where these distortions have created a much greater consumption of gasoline over the past 10 years and have greatly increased the number of cars, says David Shields, an energy analyst in Mexico City.

The deregulation in gasoline prices came about as part of an energy reform promoted by President Enrique Pea Nieto to reverse declining oil output by allowing foreign participation in what was a state-controlled sector.

Pea Nieto sold the reform with the promise of Mexicans paying less for energy, and people havent forgotten.

People are mad because gas prices affect them directly, in their pockets, said Carlos Bravo Regidor, professor at the Centre for the Teaching and Research in Economics. It doesnt matter that the gas subsidy was regressive, that cheap gas is bad for the environment, that public finances are under a lot of stress. Nothing matters. It affects them at a very direct and individual level they dont seem willing to accept.

Read more: https://www.theguardian.com/world/2017/jan/04/gasolinazo-mexico-gasoline-price-hike-protests-petrol