Mexico suspends subsidy on gasoline in border region with U.S.

Mexico, which has been subsidizing gasoline to shield residents from price spikes, announced on Saturday that the policy would not apply this coming week in the border region with the United States, including Tijuana, one of the busiest border crossings in the world.

Mexico, which has been subsidizing gasoline to shield residents from price spikes, announced on Saturday that the policy would not apply this coming week in the border region with the United States, including Tijuana, one of the busiest border crossings in the world. The government's statement did not give a reason for the suspension, which will from April 2 and April 8, in some cities in the border states of Tamaulipas, Nuevo Leon, Coahuila, Chihuahua, Sonora and Baja California.

The announcement, however, comes amid reports that since fuel prices have spiked after Russia invaded Ukraine, people living in the United States are driving across the border into Mexico in search of lower gas prices. Mexico's subsidy policy has been championed by the government of President Andres Manuel Lopez Obrador, who has long promised to insulate consumers from sharp price hikes at the pump.

In an interview with Reuters on Friday, Deputy Finance Minister Gabriel Yorio said Mexico planned to use the extra revenue it collects from higher oil prices to subsidize domestic gasoline and diesel prices.