Government has announced a boost for fuel wholesalers and retailers with an increase in their margins for gasoline.
This announcement was made yesterday by the Minister of Energy Franklin Khan during the opening of NP’s newest service station in Arima.
During the ribbon-cutting ceremony at the corner of Churchill Roosevelt Highway and O’Meara Road, Khan said, “I am pleased to announce today that the Government has recently approved a five cent per litre increase in both the wholesale and retail margins for super, premium and diesel fuels.”
Khan said in recent months, the two wholesalers of petroleum refined products-United Independent Petroleum Marketing Company Ltd (Unipet), National Petroleum (NP) and members of the Petroleum Dealers Association (PDA) had been advocating for an increase in the retail margin.
Khan said, “There were times in 2014 where this country spent $4 billion on fuel subsidy. This Government has taken the approach to gingerly reduce the subsidy with small increases in the price of retail fuel so that the subsidy burden would be relived from the State because the State was finding itself in a position where it could have no longer afforded such exorbitant subsidy payment. However, this fixed pricing nature of these liquid fuels meant that the profit margin received for each type of fuel was also fixed. This profit margin is then used to pay for station-operated expenses as well as its respective taxes. These aspects have adversely impacted on the profitability of service stations. It must be noted that an increase in these margins was provided by the Government in October 2017 but both the retailers and wholesalers have articulated the view that that was not sufficient to alleviate the burdens being faced in the industry.”
More work to do
Speaking with the Express by phone, Unipet chief executive Dexter Riley said, “It is good news and we welcome it. It definitely helps the sector. It was kind of long in coming. There’s work to be done in terms of the modelling...What needs to be done is a managed model. We look forward to achieving that going forward.”
However, PDA president Robin Narinesingh said, “The industry is in such a depressed state that that five cents could barely maintain what we lost over the years. If you go around the country and you see the state of gas stations you would see how much work needs to be done...Opening a gas station is no big thing. It’s the maintaining of these gas stations that are important...NP is a state enterprise. The dealers are the ones that have personally invested in these gas stations. They are investing their monies. NP uses taxpayers’ dollars. So the guy who takes out a loan to sustain and maintain a gas station, his children are the ones that won’t be able to go to school, his family’s needs will be affected when things go downhill...I want to see improvements at these gas stations, better interaction with the motoring public, better service.”