Wednesday, March 4, 2009 – Government has been clarifying its position on
request for increases in the margin from Petroleum Interests on the island.
The Government of Saint Lucia has been engaged in dialogue with the Petroleum
Dealers Association and the importers of petroleum products into Saint Lucia for
just over one year now.
In examining the dealers’ request, government officials say, they took into
consideration dealers’ claims of increases in their cost of doing business,
especially their fixed costs.
The petroleum dealers have requested an increase of thirty-cents per gallon on
the retail margin for unleaded fuel and forty-cents per gallon on diesel — that
up from the ten-cent increase awarded to them by government in 2008, when it
increased the cost of petrol on the island.
Over the last three weeks motorists and other users of petrol have engaged in
panic buying, which officials blame on wrong signals sent to the community.
That, they say, is uncalled for and should be discontinued.
Throughout the period of high prices for world crude, peaking at $145 per
barrel, government, officials say, maintained the retail price per gallon of
fuel and absorbed all increases in the landed price for the commodity.
Government felt then, that to have allowed the price of fuel to increase in line
with the world market prices would simply have been too much for the economy to
Instead, they say, Government chose to subsidize the price of fuel at the pumps
and other petroleum products such as kerosene and cooking gas in its effort to
cushion the adverse impact on the economy.
Officials say it is against this background and mindful of the need to ensure
the prudent management of the finances of the country that Government has
considered the requests for increases in the margin from the petroleum dealers
and petroleum importers.
Officials say they are confident of the continuation of negotiations, until a
deal is reached on the way forward.