Antigua PM criticizes gas station shutdown as fuel prices set to rise
Key Points(5)
- Antigua and Barbuda Prime Minister Gaston Browne has criticized gas station operators over their decision to close their facilities Tuesday as part of a push for higher profit margins, calling the timing of the action inappropriate as consumers face rising fuel prices.
- “I just got a call that gas station dealers are demanding an increase in their profit margin and threatening closure, at a time when the Government has eliminated its margin to keep prices down.
- Bad timing!” Browne said in a statement posted on Facebook.
- The prime minister said the government had eliminated the consumption tax on fuel in an effort to limit the impact of higher global oil prices on consumers.
- “Our government eliminated the consumption tax to keep prices down; how can anyone justify an increase in profit margin at this time, to further burden their customers, during an escalation in oil prices,” Browne said.
Antigua and Barbuda Prime Minister Gaston Browne has criticized gas station operators over their decision to close their facilities Tuesday as part of a push for higher profit margins, calling the timing of the action inappropriate as consumers face rising fuel prices.
“I just got a call that gas station dealers are demanding an increase in their profit margin and threatening closure, at a time when the Government has eliminated its margin to keep prices down. Bad timing!” Browne said in a statement posted on Facebook on Monday.
The prime minister said the government had eliminated the consumption tax on fuel in an effort to limit the impact of higher global oil prices on consumers.
“Our government eliminated the consumption tax to keep prices down; how can anyone justify an increase in profit margin at this time, to further burden their customers, during an escalation in oil prices,” Browne said.
“All gas stations are profitable. If you want to make more money; you increase prices at an opportune time, instead of burdening your customers with an increase, during a time of escalated oil prices,” he added. “That’s not good business.”
Browne said he had been assured that several gas stations would remain open Tuesday despite the planned shutdown.
The dispute over dealers’ margins predates the latest increase in global oil prices. In March, 21 gas station operators wrote to the government seeking an increase in the 8% margin they receive on fuel sales.
Operators have argued that the rate has remained largely unchanged since the early 1990s, even as expenses including wages, electricity, insurance and maintenance have increased.
The dispute comes as Antigua and Barbuda prepares to raise fuel prices amid rising international energy costs linked to the ongoing war between the United States and Iran.
Browne said on his weekly radio program that the government could no longer continue subsidizing fuel prices at the level it had maintained in recent months.
“We have not only been subsidizing the cost of fuel at the pump, but we have also been paying West Indies Oil Company rather than collecting tax revenues from the company,” Browne said.
“I want the public to understand that we normally collect between three and four million dollars monthly from WIOC on an average. So instead of collecting that three to four million dollars per month for the past six months, roughly EC$24 million, we now owe WIOC EC$15 million,” he said.
Browne said Ministry of Finance officials had advised that the required increase in fuel prices could be around EC$3.50 per gallon. However, the government determined that such a sharp increase would place too much pressure on consumers and instead settled on a smaller EC$2 increase.
“That was too large an increase to be implemented in one fell swoop, so we settled on a smaller increase,” Browne said.
Under the planned adjustment, gasoline is expected to rise from EC$14.50 to approximately EC$16.50 per gallon, while diesel is expected to increase to EC$16.25 per gallon.
