The country"s fuel prices regulator CAISTAB said it had raised petrol prices to 595 CFA francs ($1.20) a liter from 475 francs, while diesel went up to 470 CFA francs from 375.

"This was a readjustment dictated by the need to improve the state of Gabon"s public finances," the CAISTAB said in a statement.

"In August 2002 the government had suspended application of the indexing mechanism for petroleum products and had to take on a portion of the real market price of these products worth 102 billion CFA francs ($205.1 million) in 2006," it said.

Long lines of vehicles queued up at filling stations in the capital Libreville late on Saturday to top up their tanks after the CAISTAB announced plans for the price rise, disrupting traffic in some districts.

To offset the impact for the poorest citizens, the CAISTAB said it had maintained lamp paraffin and butane gas for cooking respectively at 245 CFA francs a liter and 5,625 francs a canister.

Fuel prices were raised a year ago after world crude oil prices surged to long-term highs, but the rise was restricted to 5 percent due in part to pressure from Gabon"s vocal transport operators.

This rise brings Gabon"s transport fuel prices into line with neighboring Atlantic seaboard states such as Cameroon.

High transport costs mean pump prices in landlocked neighbors Chad and Central African Republic are higher, at 650 CFA francs and 700 francs respectively for a liter of petrol.

The people of Gabon, located on the Atlantic coast in Africa"s oil-rich Gulf of Guinea, are on average the fourth richest in sub-Saharan Africa.

Projected real gross domestic product (GDP) was $4,053 per capita in 2006, according to International Monetary Fund figures, behind only the Indian Ocean states of Seychelles and Mauritius, and Botswana, the world"s top diamond producer by value.

PIN/REUTERS