Venezuela's President Nicolas Maduro has announced an increase of petrol prices in his country, which had cost around 2 cents a litre, to around 85 cents a litre.

Key points: Venezuela raises petrol prices for first time in two decades

Venezuela raises petrol prices for first time in two decades Heavy fuel subsidies had given Venezuela cheapest petrol in the world

Heavy fuel subsidies had given Venezuela cheapest petrol in the world President also devalues currency amid spiralling inflation

President also devalues currency amid spiralling inflation Nicolas Maduro under political pressure and facing risks of violent protests

Premium petrol will rise from less than 0.1 bolivars ($0.02) a litre to 6 bolivars ($1.32) — but Mr Maduro has also announced a 37 per cent devaluation of the currency, which would see a price at the pump of around 85 cents a litre.

Lower grade petrol would cost around 14 cents a litre.

Under the current exchange rate, minimum wage in Venezuela is as low as 32 cents an hour.

Venezuela has the biggest known oil reserves in the world and has been practically giving petrol away at the pump over recent years, but it has suffered from the plunge in world oil prices since mid-2014.

The change marks the first time in two decades that prices have been increased, but Mr Maduro said it was still the cheapest fuel in the world.

The move risks sparking protests in a volatile country where citizens are struggling with soaring inflation and shortages of basic goods such as cooking oil and toilet paper.

A similar gasoline price hike in 1989 sparked deadly riots.

"This is a necessary action, for which I take responsibility," Mr Maduro said in a televised address.

"The time has come to establish a system that guarantees access to hydrocarbons at a fair price but that also guarantees the funding of investment in producing that gasoline."

Mr Maduro devalued the Venezuelan currency, the bolivar, amid a widening gap between the protected "official" rate and the black-market exchange rate.

He admitted the system of currency controls introduced by his late mentor and predecessor Hugo Chavez was "worn out".

Mr Maduro hoped that by weakening the currency he would boost Venezuela's exports by making them cheaper.

He said the move aimed to spur production in the recession-hit nation.

He is meanwhile hoping major oil producers will all agree to freeze their crude production to buoy up prices.

Mr Maduro is under increasing political pressure over the crisis, with the opposition-controlled legislature trying to drive him from office.

Some analysts and politicians have warned of the risk of fresh violence in Venezuela, where 43 people died during street protests in 2014.

ABC/AFP