Liquid fuels, a driving sector of the Colombian economy

Annually in Colombia, around 130 million tons of cargo are transported by land; 47 million passengers are transported by plane; and 96% of the nearly 6.9 million vehicles and 10.9 million motorcycles that make up the automotive fleet are powered by gasoline and ACPM. These are not small figures; it is the entire national economy mobilized thanks to the continuous and responsible work of the agents in the liquid fuel distribution chain.

All this economic dynamic was reflected in the increase in fuel consumption in 2022; this is revealed by the report ‘Liquid Fuels Market in Colombia in an Energy Transition Context’, prepared by the Colombian Association of Petroleum and Gas (ACP). Compared to 2021, the total demand for liquid fuels in 2022 grew 14% and reached 345 thousand barrels per day (KBD). The consumption of diesel and gasoline increased 12%, while that of jet fuel increased 48%. It is expected that in 2023 fuel consumption will grow 2.5%.

Behind the guarantee of fuel supply to Colombians is the effort of the workers in the chain, made up of: refiner/importer, transporter by pipelines, wholesale distributors, biofuel producers, and retail distributors. In 2022, nearly 150,000 direct jobs and 120,000 indirect jobs were generated, that is, 270 thousand people working for the development of the country.

In addition to being an important job generator, it is also a source of income for the country. According to the ACP report, in 2022 the revenue of the national government and territorial entities from fuel taxes was $7.5 billion (17% more than in 2021): $4 billion from national taxes (VAT, national gasoline and ACPM tax, and carbon tax) and $3.5 billion for departments and municipalities from the surcharge on gasoline and ACPM. For 2023, it is expected that revenue will reach levels close to $9 billion.

The liquid fuels chain, committed to continuing to contribute to the national economy, will continue to make investments to improve the reliability and quality of the fuel supply service to consumers. In addition to innovating in the diversification of the energy supply for transportation and contributing to the reduction of greenhouse gas emissions.

To fulfill these commitments to the country, according to the ACP report, investments of $3.3 billion are expected for 2023. These resources will be allocated to maintenance in refineries, expansions of the pipeline system capacity and wholesale supply plants, adjustments to comply with the new technical regulation, technological developments, environmental and social investment, self-generation projects with renewable sources, research in hydrogen, and modernization of service stations towards multi-energy supply points.

Ensuring that every corner of Colombia has the guarantee of fuel supply requires addressing some challenges such as maintaining imports between 20% and 30% of total consumption between 2023 and 2032, developing strategic storage, expanding pipeline capacity, enabling alternate routes in remote and climate-vulnerable regions, and implementing government and industry plans to address blockades in communities.

#CombustibleThatDrivesUs