The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

A PROMINENT petroleum dealer has called on The Bahamas to eliminate price controls, describing them as “a thing of the past”.

Vasco Bastian, the Bahamas Petroleum Dealers Association’s (BPDA) vice-president, told Tribune Business that the Government’s proposal to expand the list of price-controlled food items by 38 product categories will impact gas stations through what they sell in their convenience stores.

“Price controls are a thing of the past. We have to do away with them. We have to come into the times. It is an outdated system,” he said. Petroleum retailers, meanwhile, are supporting calls by wholesale fuel suppliers for their own margin increase because they now “understand” the plight of dealers, a prominent operator says.

Mr Bastian said he sympathises with the industry’s wholesaler suppliers - Rubis, Esso (Sol Petroleum), and Shell - pushing for an increase in their own 33 cents per gallon of gasoline margin.

“We are all Bahamians, and we are all vested in this country and we deserve a return on our investment,” he explained. “People deserve a return on their investment. They not only report to themselves but they report to their board and their shareholders.”

Raymond Samuels, Rubis’ managing director for The Bahamas and Turks and Caicos, told reporters last week month that the price-controlled, fixed margin for wholesalers has not been changed in two years while the cost of doing business has risen significantly over the same period.

Wholesale petroleum margins are 33 cents per gallon on gasoline, and 18 cents on diesel. Retailers, meanwhile, have their margins fixed at 54 cents per gallon on gasoline and 34 cents for diesel.

Increasing margins for retailers is something Mr Bastian is still pursuing with the Government. He said: “The current government has been very accommodating. They have put some offers on the table and it’s just up to us to decide what the offer might be. But I’m happy with the negotiations. They were long but worthwhile.”

Mr Bastian did not confirm if a margin increase is among these options, but said that there was “more on the table” for petroleum retailers than just that. He confirmed: “We need the margin increase, especially since minimum wage is going up and, once that goes up, National Insurance contributions will go up. Then our overall costs will go up, our purchases for our store will go up from the grocers, and that will impact our prices, so we will have to offset that.”