LA PAZ, Bolivia — A diesel shortage is aggravating tensions between President Evo Morales' populist government and conservative agribusiness leaders, whose tractors need the fuel to begin Bolivia's planting season.

Hydrocarbons Minister Carlos Villegas announced Tuesday that Bolivia is importing diesel from Paraguay, Argentina, Chile and Peru to cover the shortfall, which he attributed to the growing economy in the nation's richest city.


"There has been a significant increase in demand for diesel, particularly in Santa Cruz," Villegas said.

Bolivia's is South America's second largest producer of natural gas, but its diesel refining capacity cannot meet domestic demand. And despite decades of chronic shortages, the government spends $100 million each year to subsidize the fuel, creating an opportunity for many Bolivians to smuggle diesel out to neighboring countries for resale at a higher price.