Petroleum retailers hopeful after meeting with minister
The Bahamas Petroleum Retailers Association(BPRA), which is pushing for an increase in fuel margins, described a meeting with the government yesterday as”very good and productive”and it has pledged to hold off any action for now.
“We feel very good,”saidOswald Moore, a retailer who heads a subgroup of the BPRA called Retailers Margin Relief Association.
“We feel that the Minister(of State for the Environment Phenton Neymour)understands our position and understands that the primary reason we are in this position is because we only had an increase of 26 cents on gas in the past 38 years. And on diesel we haven’t received anything in the past 30 years.”
The meeting came days after the association placed a ban on the sale of diesel for several hours. The action, which was intended to get the government and the public’s attention, affected scores of motorists.
The petroleum industry operates on fixed margins controlled by the government. The BPRA wants the government to allow retailers to earn a gross profit of$0.10 on the dollar for diesel and$0.15 for gasoline.
Currently, the gross profit margin is$0.09 on gasoline, and$0.04 on diesel.
As previously reported, the increase would equate to an additional$0.28 per gallon for diesel and an additional$0.30 per gallon for gasoline, according to Moore.
“We understand that it’s tough on consumers at a time like this when worldwide prices are going up,”Moore said.”But the fact is we are in a very critical position. As retailers we have held off to allow the worst of the economic downturn to pass.”
Moore said that during the meeting yesterday theminister requested additional information from the BPRA.
“When he receives that, he will present the case to the government,” Moore said.
He added that the association conducted a poll of several countries in the region and found that their prices of gas and diesel are higher than the prices in The Bahamas.
For example, he said in Jamaica, gas and diesel of the same grade offered here sell for US$5.32 per gallon each.
Moore said in Barbados, diesel is priced at$5.24 per gallon and gasoline is$5.95 per gallon. And in Cayman Islands, he said gas is priced at$6.43 per gallon and diesel at$6.23 per gallon.
He added that retailers believe that the prices on the local market are being depressed at their expense.
Neymour also said the meeting went well. He added that the government will analyse all of the information that the BPRA presented.
He confirmed that he will meet with the wholesalers to get their input.
“I can’t say when I will get back to them,”he said.”The government has to analyse, which may take some time, and after speaking to wholesalers, we will have to chart the way forward.”
He noted that the retailers’request is significant and wondered whether the economy could bear that right now.
But the retailers said their businesses cannot continue to survive without an increase.
In its initial press statement last week, the association said the industry is in a”crisis”.