30 per cent drop in Govt’s fuel import bill

The Freundel Stuart administration is reporting a dramatic drop in the amount it spent on fuel imports last year when compared to 2014.

Addressing a ceremony at The Cliff last night to celebrate the fifth anniversary of the fuel distribution company Rubis, Minister of Finance Chris Sinckler reported that Government spent approximately $452,400,000 on fuel imports for 2015, down approximately 30 per cent from the $645,400,000 spent in 2014.

Sinckler anticipated a further decline as “fuel prices on the international market . . . continue to experience downward pressure”, but he was conscious that prices could begin rising again.

As a result, he stressed that “it is therefore important that we do not lose sight of the importance of securing our energy policy”.

Oil prices climbed rapidly between 2000 and 2008 from under US$30 a barrel to almost US$150 per barrel, due mainly to growing global demands.

However, there has been a steady decline since 2014, with the price of a barrel of crude oil falling to around US$30 last year due to a number of factors, including slowing demand and increased production by some oil-rich nations.

Despite the falling prices, Sinckler said it was important to continue the push to expand the renewable energy sector, adding that Rubis must see itself not only as a “progenitor par excellence for the distribution of fossil based energy but also to put some strong investments in renewable energy”.

“I believe the next five years of our existence in Barbados should be shaped around this particular environment,” the minister said.

Chief Executive Officer of Rubis Mauricio Nicholls told reporters that with falling oil prices the company had witnessed an increase in consumption of its products.

He said customers were benefiting from the “substantially” lower prices at the pumps compared to two years ago.

“They are not as low as they are at the US but they cannot be at the same level as they are in the US for two reasons. Firstly, the logistical cost of bringing the products here is very high and the Barbados and Caribbean islands are very small markets compared to the global shipping and supply side. And also those products are subjected to, in many cases, more taxation than they are in the US. So it is a higher cost to bring the products here,” Nicholls said.

He later told Barbados TODAY the company would not rule out the possibility of getting involved in the renewable energy sector, but only after careful consideration.

“It is really not possible for me to anticipate if the answer would be yes or no, or how much we would be investing in renewables in the world in general and in the Caribbean specifically,” Nicholls said.


5 Responses to 30 per cent drop in Govt’s fuel import bill

  1. Vernon Harris
    Vernon Harris April 23, 2016 at 6:27 am

    Thanks to to fall in prices on the world market but we the consumers only see a cent drop here and there

  2. Marva Lashley-Todd
    Marva Lashley-Todd April 23, 2016 at 7:03 am

    Who he trying to fool? We have the highest price in the Caribbean and there is not much difference in the price compared to last year. Maybe Barbados Today can show a comparison in prices for the last two years.

  3. Arthur Collymore
    Arthur Collymore April 23, 2016 at 8:27 am

    The greater problem is this, that with a $380 million saving on fuel imports the foreign reserves have actually fallen, despite a 16% increase in tourism last year. One would think that with this significant decrease on spending the price at the pump would have been reduced drastically. Low oil prices will also affect the sale of blocks to drill for crude off-shore as oil producing countries cut back on their scale of production. What is worth knowing is on what this $380 m was spent since provision was made for this expenditure in the estimates of that year. With this accrued saving a clear case can now be made by those that are owed by govt.

  4. Tony Webster April 23, 2016 at 12:40 pm

    @Arthur Collomore. Touché, Sir! May I be allowed to repeat/ re-phrase your very pertinent questions:-
    ” what has become of the $380million? Should those awaiting payment for goods sold and services rendered, and a plethora of other government obligations-including those awaiting payment for compulsory acquisition of land….yet wait?

    Should we imagine what fiscal landscape we would be living in….were it not for the fortuitous fall in crude prices?

  5. Andrew Rudder April 26, 2016 at 11:26 am

    Any savings is good news but that differential in energy costs should now be input into renewable energy such as the enhancement of solar energy installations across the country. The Upper Valley of the island should have six wind turbine generators supplying St.Thomas, St George, St. Joseph and St. John.


Leave a Reply

Your email address will not be published. Required fields are marked *