The Tribune

By LYNAIRE MUNNINGS

Tribune Staff Reporter

lmunnings@tribunemedia.net

SAUDI Arabia’s plan to cut oil output is exacerbating petroleum retailers’ concerns over their current price-controlled margins regime, according to Vasco Bastian, vice president of the Bahamas Petroleum Dealers Association.

Organization of the Petroleum Exporting Countries (OPEC) are expected to meet Sunday to discuss another round of production cuts for member countries, reducing as much as one million barrels per day, according to Reuters.

The cuts could send oil prices around the world soaring.

Yesterday, Mr Bastian said the reduction in oil supply would not automatically trigger a hike in gas prices for local consumers but could be problematic for retailers.

“We are not the producers of oil, so it heightens our awareness, and it makes even a better case for us when stuff like this happens because we now are going to see a rise,” he said.

“It’s going to cost us more money to buy fuel. Now imagine staying at the same 0.54 cents. So, it’s a little bit worrisome to me, as a retailer, when you see stuff like this happening, and hopefully now the government even better understands when things like this happen.”

Prime Minister Philip “Brave” Davis said on Monday his administration believes gas retailers can profit in the current business environment despite their complaints.

Gas station operators have been urging the government to increase their margins by 50 per cent, which would raise them from the present 54 cents per gallon of gasoline to 81 cents. Their margins have not been adjusted in 12 years despite rising inflation.

In response, Mr Bastian questioned the Prime Minister’s reasoning, suggesting he was uninformed about what retailers face.

“Whoever is giving the Prime Minister information, they’re feeding him wrong information,” he said.

“I think he needs to start questioning people around him because somebody’s feeding the prime minister wrong information because that’s not right. Why would we come to you for an increased margin if we’re profitable? That does not make sense, man.”