The Tribune

By LYNAIRE MUNNINGS

Tribune Staff Reporter

lmunnings@tribunemedia.net

PRIME Minister Philip “Brave” Davis said the government has no plans to raise profit margins for gas wholesalers.

His comment came after FOCOL chairman Sir Franklyn Wilson said that a recent increase in gas retailers’ margins is unfair to wholesalers.

“At this time, we are tackling the structural issues as it relates to the cost of living,” Mr Davis said yesterday on the sidelines of the Small Business Development Centre EmpowerMEN Forum, where he was the keynote speaker.

“The issue with wholesalers has a different circumstance. We are looking at it. We are not looking at increasing. We try to find how we could decrease the cost of wholesaling in The Bahamas.”

Last week, Sir Franklyn expressed frustration because wholesalers have not received a margin increase despite rising operational costs and inflation affecting both sides of the industry. He pointed out that wholesalers last saw a margin increase for diesel in 2002, a situation he called “unfair”.

“The point is, wholesalers have not had an increase for a long time,” Sir Franklyn said. “It’s not fair, to be quite honest with you, but the wholesalers have to accept the fact that the retailers make the noise, and the politicians listen to them. That’s the reality; it’s not fair.”

When asked to comment on Sir Franklyn’s claims, Mr Davis declined to provide further details.

In September, the government approved a 25-cent margin increase per gallon of gasoline and a 16-cent increase per gallon of diesel for retailers, which took effect on October 1. Retailers had lobbied for this adjustment for over two years, citing rising operational costs and post-COVID inflation that had eroded their profits.

Unlike other sectors where businesses can adjust prices to offset rising costs, the Bahamian petroleum industry operates under government-controlled margins. This regulatory framework prevents wholesalers from independently raising their margins despite facing growing financial pressures.

Before this recent increase, the last margin adjustment for petroleum retailers occurred in 2011, under the Free National Movement (FNM) government led by Hubert Ingraham. At that time, the government approved a 10-cent increase per gallon of gasoline, raising it from 44 cents to 54 cents, along with a 15-cent increase per gallon of diesel.

When asked last week whether wholesalers were struggling in the current economic climate, Sir Franklyn declined to comment and also refrained from discussing whether wholesalers would push for a similar adjustment.