Fuel prices in Panama

Fuel Prices in Panama: What You Pay at the Pump

As of late June 2026, a litre of gasoline in Panama costs about $1.221 USD, which works out to roughly $4.62 per US gallon. Diesel is slightly cheaper at around $1.205 per litre. Because Panama uses the US dollar as legal tender alongside the balboa (pegged 1:1), there is no currency conversion to worry about — the price you see locally, around $1.22, is the same figure in dollars. That dollarized economy makes Panama unusual: unlike most countries, its drivers never feel the sting of a depreciating local currency pushing up fuel costs.

Why Panama's Prices Sit Below the World Average

Panama's pump price is meaningfully below the global retail average of about $1.484 per litre. In fact, the country ranks 51st of 170 nations surveyed — comfortably in the cheaper half of the world. There are a few reasons for this. First, Panama is a net fuel importer with no significant crude production of its own, but it benefits from its strategic position around the Panama Canal and large coastal storage and trans-shipment terminals, which keep logistics costs competitive. Second, the government has historically intervened to smooth prices, periodically capping or subsidizing fuel for consumers and for the public transport sector to shield households from international oil spikes.

Fuel taxes in Panama are also relatively modest compared with Europe, where excise duties can double the retail price. Panama applies a fuel consumption tax, but it is not aggressive by global standards — one reason a dollarized, import-dependent country still manages to keep prices below the world midpoint.

The Ten-Year Price Trend

Looking at the historical record from July 2016 through June 2026, the average price over the decade was about $0.90 per litre. The cheapest day came on 6 April 2020, when prices collapsed to roughly $0.47 per litre as the COVID-19 pandemic gutted global oil demand. The most expensive moment was 20 June 2022, peaking near $1.59 per litre during the post-pandemic energy crunch and the supply shock that followed Russia's invasion of Ukraine.

Today's $1.221 sits above the ten-year average but well off that 2022 high, suggesting prices have eased from their peak while remaining elevated by historical standards. The huge swing between $0.47 and $1.59 also shows how exposed an import-reliant economy is to world crude markets, even when the currency itself is rock-steady against the dollar.

How Panama Compares Internationally

Panama's fuel is cheaper than in much of Latin America's importing neighborhood but pricier than in heavily subsidized states. Compare it with neighboring Colombia, an oil producer that has been phasing out its long-standing fuel subsidies. Elsewhere, island and developing economies like Madagascar show how import dependence plays out differently without a dollarized buffer, while subsidy-heavy nations such as Burma (Myanmar) and Uzbekistan sit at very different points on the price spectrum. You can browse the full picture on our world fuel prices overview.

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