BOGOTA (Reuters – Colombia’s fuel subsidies fund is expected to double in size to $33.7 trillion Pesos ($8.8 Billion) due to rising oil prices. The fiscal rule committee of Colombia said Monday. This means that it will have to increase pump prices slowly.

According to the advisory committee that oversees public accounts, the deficit in the fund, which is distinct from the national, would equal 3.3% of the gross domestic product.

Colombia is the country with the highest oil export. However, high prices have helped to offset rising material costs.

Inflation of nearly 3%, with fuel prices rising by 8.53%, has prevented the government from passing the increased price on to the consumers.

According to the Committee, the Fund for Stabilization of Fuel Prices had a deficit of 14. trillion pesos (or $3.66 billion) as of the end of the first quarter. It is possible that the debt to this fund will rise up to 33.7 trillion pesos at the end 2022.

Juan Pablo Cordoba, president of the committee said that inflation must be addressed. A strong rise could lead to inflation worsening. Sometimes, when faced with difficult decisions, the best thing is to not do anything. However there can be consequences.

The committee stated that inflation will rise by 0.08 percent for every point in which fuel prices increase.

Last week, the government stated that the draft of a decree was to be published. It is intended to modify the process for setting fuel prices to make them more comparable with international levels.

($1 = 3,819.07 Colombian pesos)