After weeks of contention and protest, the Guyana Oil Company Ltd (Guyoil) on Tuesday announced a reduction in prices for gasoline and gasoil. This reduction, according to the State entity, takes effect from Tuesday.
“Gasoline,” according to Guyoil, which as a State-owned company, has been referred to as the price setter for private entities, will move “from $230 per litre to $226 per litre and Gas oil (LSD) from $219 per litre to $215 per litre.”
According to Guyoil, the price reductions were possible due to “declining acquisition costs and the savings are now being passed on to customers.” Moreover, the oil company pledged “that any savings as a result of declining acquisition cost will at all times be passed on to the customers.”
The parliamentary Opposition has pointed to Guyoil and the difference it could make, when outlining ways in which the Government can make a meaningful intervention into the issue.
At a press conference, Opposition Leader Bharrat Jagdeo had said there is fiscal space to make the adjustment with the tax regime to allow a reduction of gas prices for local consumers.
Jagdeo had related that under the People’s Progressive Party/Civic (PPP/C) Government, there was a system used in cases like these, where the taxes can be adjusted based on the movement up or down on the gas price, so that the benefits would be passed onto the people.
Given the mounting criticisms and the need for serious attention to be paid to the issue, the PPP/C General Secretary had said that, “The Government through public pressure must adjust the rate at the pump. They have a lot of room. They have the fiscal space as well as the tax play to make that adjustment.”
The former Guyanese Head of State had recalled that when the prices for crude oil stood at about US$75 per barrel, lower that the US$120 high before the rapid tumble a few years ago to about US$28.
“We had argued that with the rapid tumble, the benefits should have been passed on to the Guyanese public, who would have seen lower prices at the pump and in their electricity bill. They never did that. And what happened was that they raked in billions in revenue; they collected over $25 billion at GPL alone.”
He had told the media that with the crude prices at about US$75 a barrel and not US$120, there was definitely room to make significant adjustments to the price of fuel at the pump.
Another point raised by Jagdeo was the fact that under the PPP/C Government, the Guyana Oil Company (Guyoil) was used as a regulatory agency whereby the price at the State-owned entity set precedence for other companies to follow.
However, the fact that prices were high even at Guyoil meant that private companies did not have to lower their prices in order to maintain their competitiveness. And this situation saw bus drivers threatening to raise their fares and protesting in a seeming chain reaction.