By Mohammed Sudam
Reuters
Wednesday, July 20, 2005; 8:47 AM

SANAA (Reuters) - At least 11 people were killed in clashes with police in Yemen on Wednesday after rioters threw stones and set fires in streets to protest against subsidy cuts that nearly doubled petrol prices, witnesses said.

Thousands of protesters in the capital, Sanaa, smashed furniture in government offices, blocked roads with flaming tires, and knocked out electricity transformers in some areas.

Police fired shots to disperse protesters hurling stones at the offices of Prime Minister Abdul-Qader Bagammal and ambulances rushed some injured people from the scene.

Witnesses and medics reported similar protests in three other towns, including the town of Dhala in south Yemen where five of the 11 dead were killed.

Demonstrators shouted slogans attacking Bagammal and the ruling party of President Ali Abdullah Saleh.

Police, using tear gas and water cannon to control the crowds, blocked off the house of Vice President Abd-Rabbu Hadi where protesters converged.

Yemenis are protesting against a government announcement on Tuesday to cut fuel subsidies as part of reforms backed by the International Monetary Fund and World Bank.

"This is a natural reaction because the government's reforms are a lie and we can't take it any more...This government is making the rich richer and the poor poorer," said one young man in Sanaa.

A liter of diesel rose to 45 rials (24 U.S. cents) from 17 rials; a liter of petrol was priced at 65 rials, up from 35 rials, and a liter of kerosene rose to 45 rials from 16 rials. Gas cylinders rose to 400 rials from 250 rials.

Bagammal has said the government wants to cut $500 million a year of diesel subsidies as part of an economic reform program in the poor country of 20 million people.

The government said this week's hikes were in line with surging global oil prices.

Opposition parties say such measures will increase pressure on the poor and demand instead a crackdown on corruption, which they blame for Yemen's economic problems.

Yemen began implementing harsh economic reforms to address a sharp budget deficit, high unemployment and crippling bureaucracy.

According to World Bank figures, more than 42 percent of its 19 million people live below the poverty line, illiteracy is estimated at 50 percent and unemployment is over 20 percent.