Gov’t monitoring cost of fuel but cannot control int’l oil prices – Dr. Singh
By Vishani Ragobeer
There has been a hike in local fuel prices and Senior Minister within the Office of the President with responsibility for Finance, Dr. Ashni Singh says the government has been monitoring this situation but he emphasised that the administration has no control over international oil prices.
Dr. Singh said this on Saturday while attending an outreach activity organised by the National Insurance Scheme (NIS) at the Giftland Mall, Georgetown.
According to him, global oil prices have been increasing and it has had an adverse impact on the cost of fuel locally.
“The reality is that oil prices are a function of the international market and so the cost of landing fuel has increased,” Dr. Singh explained.
But, he reminded that it was only a few months ago that the government took the “important step” of reducing excise taxes on fuel products to allow for a reduction in fuel cost.
In February, in order to minimise the impact on domestic consumers, particularly the travelling public as well as those productive sectors where fuel is an important input, Minister Singh had announced that the excise tax rate on both gasoline and diesel will be reduced from 50 per cent to 35 per cent with immediate effect.
Dr. Singh, however, explained that taxes are only a small part of the cost of fuel the consumers pay for when they fuel up at the pump. As such, even with the reduction of the excise taxes, there are other factors to consider that lead to an increase in the cost of fuel.
Explaining this further, he said, “The reality is that the CIF value of fuel is now a lot higher than it was six months ago.
“It is something we have to keep looking at. We are looking at it very closely and we are aware that the prices have been creeping up and what that has meant for businesses operating in Guyana,” the Senior Minister said.
Contextually, cost, insurance, and freight (CIF) is an expense paid by a seller to cover the costs, insurance, and freight of a buyer’s order while it is in transit.
Checks made at the major gas stations in Georgetown show Shell’s price at: Fuel Save – $207.0 per litre, V-Power – $212.0 per litre, Diesel – $185.0 per litre; the Rubis Vlissengen Road gas station: Pure 95 Gasolene – $210 per litre, Diesel – $189 per litre; at GuyOil Super 95 Gasolene is $203 per litre, Ultra Low Sulfur Diesel $190, Kerosene $125 per litre.
President of the Georgetown Chamber of Commerce and Industry (GCCI), Timothy Tucker said that local businesses have been hit hard by the gas prices but he pointed out that even more pressure is being placed on ordinary consumers in the pandemic-driven economy.
“It is a double-whammy situation for Guyana because we are now an oil exporter so the rising prices actually benefit us as an exporter or crude but as a consumer, it is putting us at a disadvantage…it is automatically affecting everybody’s daily operations,” he had told the News Room.