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PM Barrow comments on fuel prices

Fuel prices are at an all-time high but not for long says the Prime Minister. Importation of petroleum products from PDVSA under the PetroCaribe program was temporarily suspended. This led the government to import fuel from El Salvador, leading to the increase of fuel prices. However, today the Prime Minister told the press that fuel prices are expected to decrease soon.

Rt.Hon.Dean Barrow, Prime Minister

“It’s not a matter of consideration it is a matter of fact that there will be a moderation of the prices and we put out a press release I think yesterday explaining exactly why this is so. The increases have not come about as a consequence of any government raising government’s tax share of the structure of the equation that results ultimately in the pump price we have done nothing. It is that the acquisition costs have become dearer and they have become dearer so much in consequence of the market movements but as a result of two things, the hurricane which in Texas which caused prices to go up all across the board but we know that by the next shipment that would have righted itself and the second reason is as  I’ve explained more than once before precisely because of the instability of the supply that we were getting from Venezuela, what would happen was that at the very last minute we would be told the amount that you’ve ordered Venezuela can’t find. It caused then the importer to have to scramble to make last minute purchases to make the significant shortfalls. The last purchases are at a higher rate than if you plan and if you place your volume orders well in advanced. The last minute purchases also meant that you had to as well scramble to put in place transportation arrangements that we would not in fact have agreed at the time you initially placed you order because you didn’t know that Venezuela would not be able to fulfill the order so it is that combination of factors that resulted in this extraordinary spike in the prices. Now as I said on Independence day the Venezuelans have made it absolutely clear that come hell or high water they will supply what we order. So there will not be that factor of having to scramble at the last minute to go buy on the spot market at a higher cost that is number one. Number two the temporary problem caused by the hurricane would have righted itself so there is absolutely no doubt in my mind that the price will come down for the mid October shipment. I know there’s this little saying that if I promise you something and it doesn’t happen I will eat my hat, I will do better; if as a consequence of what I’m saying we still don’t see any reduction in prices then government will eat a part of the cost, government will lessen its stake which it has not increased which has been fixed will have to lessen its stake until matters can be re-balanced so that I can deliver on what I’m saying here today which is that the prices will go down with the October 15-17 shipment.