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Fuel blow – Symmonds warns Barbadians of possible hike in oil prices

Article by Colville Mounsey – taken from the Daily Nation October 6, 2022

JUST WHEN BARBADIANS were beginning to get some relief at the pump, Minister of Energy Kerrie Symmonds is putting the country on notice that prices on petroleum products are once again likely to skyrocket.

This is because the OPEC+ (Organisation of Petroleum Exporting Countries) alliance announced a two million barrels a day cut in oil production yesterday, an amount that could drive oil and gas prices back up after weeks on a downward trend. The decision by the 24 OPEC+ oil-producing countries, including Russia, comes at a time when much of the world is already battling soaring energy costs.

Symmonds explained that the implications go well beyond the cost at the pump, as the impact on the stability of energy prices is likely to be felt across the board.

Extremely disappointed

“Oil prices were moving in a direction that would have given us some degree of comfort and I am extremely disappointed by the news that broke [yesterday] morning. We were beginning to roll this back and get this bad situation under control. The production cut in my estimation was calculated to drive back up oil prices,” he told the DAILY NATION.

In August the Mia Amor Mottley administration attempted to shield Barbadians from rising oil prices by capping the cost at the pump.

Symmonds said that over he last month the approved prices for gas and diesel were below the cap, stressing that the OPEC development may have now eclipsed the light at the end of the tunnel.

“Those oil prices were coming down and that is why I said we were getting this under control. The prices were below US$120 per barrel in June and then Government would have imposed the price cap. For the last month and a half when I would have had to approve prices in Barbados, they were actually below the price cap.

Minister says OPEC decision ‘exceptionally worrying’

“So the prices were falling, and performance was perhaps better than expected. Now we have an intervention by OPEC, which I believe is calculated in a very crude manner to drive the price of oil back up to zones that would cause people around the world to fear global economic recession. The fact that a group of the world’s most powerful oil producers can make this decision is exceptionally worrying,” he added.

On Monday gasoline prices fell to $4.14 per litre, a decrease of 12 cents, while diesel fell to $3.90 per litre, a reduction of four cents. Kerosene has also dropped by two cents to $2.14 per litre. The cap on the retail prices of gasoline and diesel are at $4.48 and $4.03 per litre, respectively.

When questioned on the development’s potential to impact Government’s continuity of the cap on fuel past January next year, Symmonds said while it was too early to say, Barbadians must now be prepared to take greater responsibility for their energy savings through conservation.

He stressed that Barbadians could ill afford to wait on Government to provide cover from the vagaries of the global oil market. He also pointed out that the development underscores the importance of Barbados fast-tracking its energy independence objectives through its renewable energy push.

“I know that this question is going to be raised and the question of the gas cap ultimately carries far wider policy considerations, and it is not something that you rush to say yes or no to at this point. What I can say to Barbadians, who I hope now understand the importance of reasoning this through, there is a part of this discussion that we as a country have some control over.

“The missing link in this is that we must stimulate a conversation in Barbados about energy conservation. It can’t be just that Government rushes in and provides an apron for us to hide behind. It has to be that we do what we can at the individual level to conserve the energy that we are burning because it comes at a high cost,” he said.

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