Price of fuel at the pump keeps pumping up - 10/27/10 04:35 PM
Premium has gone up forty cents a gallon from 9.89 to 10.29. Regular has gone up fifty three cents a gallon from 9.51 to 10.04 a gallon. Diesel is the only one that went down, modestly, from 9.19 a gallon to 9.14 per.
At midnight on Monday, when most were in deep slumber, the prices of fuel went up again for umpteenth time this year. The increase is merciless and has sent prices soaring well above the ten dollar mark. So to greet the New Year, premium went up by forty cents and is now selling at ten dollars and twenty-nine cents per gallon at the pumps. And if you think that’s a big jump, well regular went up by fifty-three cents and is selling at ten dollars and four cents. There is a little relief for consumers and that is because the price of diesel went down by five cents and is selling at nine dollars and twenty-four cents. So the next time you head to the pumps, you are bound to feel the pain where it hurts the most: your pockets.
Earlier our viewers polled that fuel prices should be brought down as promised by the prime minister. Prices for premium and regular gasoline are now over the ten dollar mark, but the PM says he is not about to revisit the one-dollar tax that he imposed a few years ago and promised to revisit. The only silver lining for consumers is the hope that prices for the crude would eventually start to go back down.
“I’ve just checked last night and I see that oil is now trading at under ninety dollars a barrel. This huge spike in pump prices was a large measure to the fact that the acquisition costs for the refined product has gone up based on the ninety-one, ninety-two dollars per barrel at which crude oil was trading. Look, it’s not just a matter of supply and demand in terms of the international prices. It also has to do with speculation. It also has to do with people fleeing into commodity as a hedge against a weakening dollar—oil is traded in U.S. dollars. The dollar has strengthened against the euro. The global economy and the US economy in particular are showing some new signs of robustness for 2011. People are now getting out of commodities and deciding to invest more in equities in bonds and into dollar holdings. As long as that trend continues there will be continuing downward pressure on the oil prices. We have to look and see. The OPEC people are saying that they expect oil for 2011 to trade between the seventy and eighty dollar per barrel range. If that’s what happens, there is no need for me to revisit the tax. If this drops now back down to under ninety-dollars a barrel doesn’t hold, if it goes back up about ninety dollars a barrel and trading at over ninety dollars a barrel does hold for three months or so, then at budget time I will have to do something. But it is so volatile and there is so much that goes into the mix that you can’t be premature and you can’t jump too quickly. I’d look like a fool going up and down like a yoyo. We’ve got to see what a trend is. This is a blip not a trend.”
“But locally though, can Belize have a plan B, how far away are we as…”
“The plan B is to refine.”
“Yes, how far are we away from that?”
“We have two proposals. Some Mexicans have approached us. We’ve done the due diligence. They appear to be very serious, very well healed and with technical ability to do this. One thing that’s holding up in making a decision in their favor is that BNE has said that it is contemplating the possibility of a full fledge refinery. Gilly Canton, the C.E.O. told me that their Board will make a decision by the twelfth of this month. If BNE wants to do it, in my view, it will be a Cabinet decision; my view is that we go with BNE. They are the ones extracting the oil. They have a little bit of a track record in so far as one of their principals had gone into the blue sky venture that did some partial refining or more like blending to produce a diesel product. That went awry because of personality problems between the person who was from BNE and the partner from Houston. But if the BNE Board of Directors votes to make the investment in the refinery, Cabinet will have to determine which would be the better proposal. I am prepared to say from now it just seem to me preliminarily to make more sense to go with the people that are already here.”
The cost of just about everything is on the rise, but there is one area where Prime Minister Dean Barrow promised relief when prices passed a certain mark. That is the price of fuel. We asked our viewers if they believe the PM should be held to his word to remove the dollar tax that was added on fuel in March 2009 since the prices are much higher than the eight dollar threshold. Eighty-nine percent voted yes on our e-poll and one commented that “I believe that he should be held accountable and if he fails to do so, the people should demonstrate.” Meanwhile, eleven percent of voters said no and one of them pointed out that “Belize’s PM has no role or say on the global fluctuations in oil production and demand, which dictates the price of crude.” There was also the sentiment that if he removes the dollar tax, it will just be imposed on something else. In response to that, another viewer suggested transferring the tax to products like cigarettes and liquor.
The Prime Minister says that if the high world prices continue, he will have to re-visit the one dollar gas tax in his next budget:
Hon. Dean Barrow, Prime Minister of Belize
"If this drops back down to under $90 a barrel does it hold, if it goes back up above $90 a barrel and trading at over $90 a barrel does hold for 3 months or so then at budget time I will have to do something. But it's so volatile and there is so much that goes into the mix that you can't be pre-mature, I'll look like a fool going up and down like a yoyo, we've got to see what a trend it is. This is a blip, not a trend."
Marion Alley, Reporter Channel 5
"But locally though can Belize have a plan B, how far away from the possibility...."
Hon. Dean Barrow, Prime Minister of Belize
"Plan B is to refine. We have two proposals, some Mexicans have approach us, we are done the due diligence, they appear to be very serious, very well healed and with the technical ability to do this. One thing that holding up making a decision in their favor is that BNE has said to me that it is contemplating the possibility of a full fledge refinery. Gilly Canton, the CEO told me that their board will make a decision by the 12th of this month. If BNE wants to do it in my view it will be a cabinet decision, my view is we should go with BNE, they are already, they are the ones extracting the oil."