Puerto Rico on the Brink of Losing Access to Gasoline & Electricity amid Economic Crisis

The economic crisis in Puerto Rico is threatening the country's access to gasoline and electricity, officials said on Monday.

Late last week, Puerto Rico arrived at a tentative deal with Total Petroleum Puerto Rico Corp. after the company decided that it would no longer supply gasoline to state vehicles due to the nation's debt exceeding more than $16 million, said Danny Hernandez, a spokesman for the General Services Administration, NZ Herald reported.

Hernandez noted that the agreement is in effect only if Puerto Rico's government makes a $3 million payment on Monday and another $4 million payment before January ends, the news outlet added.

The government's lack of liquidity has also almost left the island's ambulances, patrol cars, fire trucks, and other public vehicles without gas supply this Monday. The head of the Legal Department at Total Petroleum Puerto Rico Corp., Denise Rodriguez, said that "a friendly accord" was reached to maintain the fuel supply, according to Fox News Latino.

Rodriguez noted that the French major oil and gas corporation started its operations in Puerto Rico eight years ago and that it intends to maintain that relationship, Fox News Latino reported. The goal is to keep the debt below $10 million, the limit Total set on credit line.

The Caribbean island's greatly indebted public power firm also announced it would cut electricity supply to three hospitals and clinics this week because of their unpaid multimillion dollar bills, NZ Herald further reported. Jose Daniel Echevarria, a spokesman with the Electric Power Authority, said that the service cuts can be prevented only if the hospitals and clinics come up with a payment plan in the coming days.

Last month, the power company has cut off power to the government's Highway and Transportation Authority due to unpaid bills, NZ Herald noted. Services, however, were re-established when a payment plan was agreed to.

Puerto Rico's deteriorating financial state comes amid the country's nine years of economic stagnation, NZ Herald added. There's the $72 billion in public debt as well, which, according to the governor, is unpayable and requires restructuring.

"We're already seeing the first consequences of this situation," Public Affairs Secretary Jesus Manuel Ortiz said at a press conference on Monday, as quoted in NZ Herald's report. "If we don't address the reality of this crisis, it will only worsen."

Ortiz has renewed the Puerto Rican government's appeal for the U.S. Congress to allow the island access to a kind of bankruptcy mechanism, the news outlet noted. The government is slapped with its first lawsuit over how it has diverted funds to meet certain bond payments as its liquidity declines.