Symmonds defends the price of petrol

Article by: Maria Bradshaw – Taken from the Weekend Nation,  Friday Friday August 5, 2022

Barbados now has the fourth most expensive gasoline price in the world.

It made a huge leap from 11th last month to fourth on August 1, among over 150 countries.

According to the website globalpetrolprices, one of the leading providers of data on the retail prices of motor fuel, electricity and natural gas, while the average price of gasoline was US$1.41 (BDS$2.82) per litre, Barbados’ is at US$2.338 or BDS$4.72 per litre.

Hong Kong has the highest price at US$2.98 followed by Iceland (US$2.475) and the Central Africa Republic at US$2.343.

The closest other Caribbean country is Cayman Islands which is ranked at No. 22 with a price of US$1.978, followed by The Bahamas at No. 36 with a price of US$1.843 and Jamaica No. 50 with US$1.705.

Countries like the United Kingdom, which was 11th at US$2.24; Canada (US$1.559); and the United States at US$1.18, had much lower gasoline prices.

Earlier this year, Barbados was around No.30 in the world but this started to quickly change following the drastic increase in oil prices, mainly due to the war in Ukraine. The last price increase locally was on July 3, when there was a whopping 31 cents jump at the pump.

In reference to gasoline prices in Barbados from April 25 to August 1, globalpetrolprices noted: “The average value for Barbados during that period was BDS$4.48 with a minimum of BDS$4.13 on April 25, 2022, and a maximum of BDS$4.72 on July 4, 2022. For comparison, the average price of gasoline in the world for this period is BDS$4.10.”

Differences

The website pointed out that there were substantial differences in the prices among countries. “As a general rule, richer countries have higher prices, while poorer countries and the countries that produce and export oil have significantly lower prices.

“The differences in prices across countries are due to the various taxes and subsidies for gasoline. All countries have access to the same petroleum prices of international markets but then decide to impose different taxes. As a result, the retail price of gasoline is different.”

When contacted with this information, Minister of Energy Kerrie Symmonds pointed out that Government had put measures in place to shield Barbadians from the impact. He said such comparisons were pointless.

“Simplistic comparisons between the price of fuel in Berlin, Bahrain, The Bahamas and Barbados are uninformed and pointless. Some states have capacity to import petroleum products, others do not. It would be unwise to expect that an energyimporting state could sell to consumers more cheaply than the energy exporters could.

“Equally, some countries have internal measures that shield consumers from associated costs not reflected in the petroleum price. For example, the average Bajan consumer pays no road tax, while our neighbours in the wider Caribbean have to pay it.

Savings

“So despite having a different price structure, many Barbadians therefore enjoy the advantage of a savings option by being able to exercise personal discretion in the amount of driving they do,” Symmonds said.

He stressed that Government had also done a lot more economically and socially to ease consumers.

“Many governments like the Canadian and the USA governments have not opted to intervene at all either at the pump or in the wider food and beverages sector in order to shield consumers from surging prices. Their philosophy is that to chase rising prices is a race to economic death.

“Some, on the other hand, have been very trifling with the assistance offered to consumers, so places like St Vincent have opted to intervene only by way of VAT (value added tax) adjustment at the petrol pump.

“The Barbados Government has intervened to shield consumers both in terms of petrol products and in the cost of food and beverages and also in the cost of electricity in the home. Government is now also subsidising summer camps. I know of nowhere else on earth that this has happened. So I think we have a bit to be grateful for and might wish to focus on those wider considerations,” the minister added