Fuel Subsidy/Gas Price Issues

[Rory Phoulorie]

Before hybrids are introduced we need charging stations, . . .

No sir. Before full electric vehicles are introduced, we would need charging stations. Hybrids have both electric motors and internal combustion engines. The internal combustion engine either powers the electric motors while the batteries are being re-charged, or drives the car directly while the batteries are being re-charged.

[~Vēġó~]

gonna be getting me something with a big block v8 yeah!!!!!!

[Allergic2BunnyEars]

:?:

Oil was $86 dollars plus a barrel and averaged around $90 in 2012.....

Oil is currently $107.23.....

Mr. Howai, explain to us how the government pays for the subsidy when there is a big drop in the price of Oil, like down to $40 USD?

Cause ah mean the economy would be in the toilet at that point and Gov revenue would be minuscule

The government pays a piece of the subsidy. The oil companies that drill for oil here pay a portion and the government pays the excess. If the price of oil drops the amount the government pays also drops and more of the burden lies on the companies.

[Rory Phoulorie]

gonna be getting me something with a big block v8 yeah!!!!!!

Twin turbo big block V8.

[ingalook]

:?:

Oil was $86 dollars plus a barrel and averaged around $90 in 2012.....

Oil is currently $107.23.....

Mr. Howai, explain to us how the government pays for the subsidy when there is a big drop in the price of Oil, like down to $40 USD?

Cause ah mean the economy would be in the toilet at that point and Gov revenue would be minuscule

The government pays a piece of the subsidy. The oil companies that drill for oil here pay a portion and the government pays the excess. If the price of oil drops the amount the government pays also drops and more of the burden lies on the companies.

That is why you are not the minister of Finance... at that price there would be no subsidy... Government may be legally bound to drop the price of gas

So what we saying is during the first Oil boom Government introduced the Petroleum Subsidy Act of 1974 to buffer large increases to consumers, stem inflation and impose the collection of a levy from oil producers... and now in our 3rd "boom" the Government of the day (while enjoying significant energy dollar windfalls)decides that buffering consumers and reducing inflation is no longer a priority - AND you buy into the idea

[nervewrecker]

I think people who have more than one child and unemployed should be made sterile, jailed and children be put in homes/adopted.

fixed it for you

[Allergic2BunnyEars]

:?:

Oil was $86 dollars plus a barrel and averaged around $90 in 2012.....

Oil is currently $107.23.....

Mr. Howai, explain to us how the government pays for the subsidy when there is a big drop in the price of Oil, like down to $40 USD?

Cause ah mean the economy would be in the toilet at that point and Gov revenue would be minuscule

The government pays a piece of the subsidy. The oil companies that drill for oil here pay a portion and the government pays the excess. If the price of oil drops the amount the government pays also drops and more of the burden lies on the companies.

That is why you are not the minister of Finance... at that price there would be no subsidy... Government may be legally bound to drop the price of gas

So what we saying is during the first Oil boom Government introduced the Petroleum Subsidy Act of 1974 to buffer large increases to consumers, stem inflation and impose the collection of a levy from oil producers... and now in our 3rd "boom" the Government of the day (while enjoying significant energy dollar windfalls)decides that buffering consumers and reducing inflation is no longer a priority - AND you buy into the idea

The 1974 petroleum subsidy act was introduced after Arab nations withheld oil to spite the US over Israel. Oil prices worldwide spiked and inflation skyrocketed here as we import a lot of items. The act was put in place so that consumers would not feel the impact of volatile oil prices.

This act has been in place since oil was $10 a barrel and was in place when oil went down to $50 a barrel as recently as 2008 recession. Yes at $50 a barrel it cost more to produce gasoline than what we saw at the pump locally. Don't just accept my word for it. Look thru government records tied to oil prices and you will see this. You are making an unfounded assumption that at $40 a barrel of oil would mean no subsidy.

Booms mean nothing if spending the money on things of little gain. If you bothered to read the buffets of recent years you will see the fuel subsidy has run away to 4 billion tt approximately along with the fact that we have deficit budgets. We are spending more than we are earning in what YOU call a boom. We have been spending more than we have been earning for the last 3 years. It isn't feasible in the long term to continue this way which is why the government is trying to wean people off the subsidy slowly. Cng is the way seen by the government in reducing this subsidy.

The price increase for premium was to show the population that other price changes are coming. A wake up call if you will. While they may have told the layman public that it was to reduce the subsidy they already knew the populace would switch to super and drive up the subsidy.

[X2]

For the intense history buffs that seem to know the history of oil prices... keep in mind, the prices are based on speculation and often dont see the light of the accountants desk lamp during subsidy calculation.

I would love to see how this thread goes if Google were to crash...

[Allergic2BunnyEars]

For the intense history buffs that seem to know the history of oil prices... keep in mind, the prices are based on speculation and often dont see the light of the accountants desk lamp during subsidy calculation.

I would love to see how this thread goes if Google were to crash...

Which prices are you speaking of? If you are speaking of the price of oil I would say accountants take into account what Petrotrin would have paid for oil and this cost would have been passed onto NP in the finished product. I don't quite get your point about speculation when prices actually reached the figures stated. Noone was talking about future oil prices or what was driving the prices at the points in time. If you know more shed light.

[Redman]

:?:

Oil was $86 dollars plus a barrel and averaged around $90 in 2012.....

Oil is currently $107.23.....

Mr. Howai, explain to us how the government pays for the subsidy when there is a big drop in the price of Oil, like down to $40 USD?

Cause ah mean the economy would be in the toilet at that point and Gov revenue would be minuscule

The government pays a piece of the subsidy. The oil companies that drill for oil here pay a portion and the government pays the excess. If the price of oil drops the amount the government pays also drops and more of the burden lies on the companies.

In Tdad-the subsidy on FUEL is not directly related to oil prices-

GORTT owns all resources in the ground. The companies that produce oil essentially have a license to bring the oil to surface.

The oil is then bought by Petrotrin at a price that equates to 50-70% of WTI spot price.at WTI $89 producers get between 40 and 68 USD per BBL
The difference is made up of Royalties and Taxes and an user fee.
These are revenue to GORTT and Petrotrin.
We produce 50% of the oil we refine and import the rest
We pay WTI based prices depending on the quality of crude.

Which means that for every BBL of oil we import we forgo the Revenue/taxes and pay more for that BBL.

Regarding the subsidy.
Gas/Diesel is purchased from Petrotrin, by NP/Unipet at international market prices.
GORTT provides a subvention to NP/Unipet for say 75% of that market price-this represents the subsidy.

The market prices of fuel have a correlation to oil prices but not a direct one.

So regardless of the price of oil we will always have a subsidy.

For those that still up-we can increase oil production,cut our import bill and then create room to keep the subsidy.

[Allergic2BunnyEars]

Good points Redman but I would still like to reiterate that while while fuel prices are not 100% directly related to oil prices they do scale somewhat with oil prices and hence when oil prices skyrocket so too does the cost of the fuel due to the fact as you said that we import oil to refine.

[neals]

they gonna thief anyway

True, but at least we will benefit a little.

THATS REALLY WHAT SOCIETY COME TO? WE ACCEPT THEY GONNA THIEF AND WHO EVER GIVE BACK FORM WHAT THEY THIEF WE SATISFIED WITH THAT?

[silent_riot]

Nice post, Redman.

[MG Man]

, the Government needs to provide/support a reliable form of mass transit as an alternative. They also need to clamp down on the maxi taxi mafia with how some of the owners/drivers "rob" passengers with this short drop foolishness.

THIS........plus decentralize POS (never gonna happen tho)

[redmanjp]

I think people who have more than one child and unemployed should be made sterile, jailed and children be put in homes/adopted.

fixed it for you

like allyuh want to move to china

the money that would be saved from this equals what % of the subsidy?

[redmanjp]

u know even if a rapid rail cost billions to implement in the long run after a few yrs cant it pay for itself in a reduced subsidy bill?

[janfar]

Bring fuel prices to global standards. Remove monopoly on the market for supplying for fuel.

Thats what needs to be done. Then and only then ppl will understand what it means to own a car.

[Allergic2BunnyEars]

Bring fuel prices to global standards. Remove monopoly on the market for supplying for fuel.

Thats what needs to be done. Then and only then ppl will understand what it means to own a car.

If diesel goes from $1.50 to $7 per litre in the space of a day what do you think will happen? This is an open question to anyone not just you by the way. Add super to the mix from $2.70 to $5.45 per litre and ask what the repercussions would be (apart from people "learning" the true cost to own a vehicle)

[janfar]

Nothing will happen... increase it for the budget, let the ppl kyak, which is all they do, and then call Local elections one time...

[Allergic2BunnyEars]

Nothing will happen... increase it for the budget, let the ppl kyak, which is all they do, and then call Local elections one time...

That simple?

[janfar]

When the price of bread, cement and everything else went up everybody kept on buying. Trini's have a 5 day memory, all you have to do is pass a legislation just before xmas, carnival or some other major event. It may cause the govt to lose election next time but that already going to happen.

I still think fuel should be raised across the board to reflect what we pay for it. Put is subsidy on food to bring those prices down.

[Allergic2BunnyEars]

Ok. I think that will eventually happen but I think the government should put things in place transport wise before removing the subsidy.

[janfar]

I think we have things in place somewhat. It have busses parked up all over in PTSC yards collecting dust because they are not economically feasable to run. Why run a bus costing, lets say 20 dollars, when you only have 5 dollars worth of ppl using it. Everybody and they tanty want to drive to go everywhere... look, on your next drive to anywhere how many 'passengerless' cars on the road. If all those ppl were to use the PTSC it would become more feasable.

[Allergic2BunnyEars]

I think we have things in place somewhat. It have busses parked up all over in PTSC yards collecting dust because they are not economically feasable to run. Why run a bus costing, lets say 20 dollars, when you only have 5 dollars worth of ppl using it. Everybody and they tanty want to drive to go everywhere... look, on your next drive to anywhere how many 'passengerless' cars on the road. If all those ppl were to use the PTSC it would become more feasable.

Running buses on diesel doesn't really help much I would say. For the plan to be feasible you would need buses on cng or a cheap alternative source of energy. I actually don't see many empty buses for that matter which implies the service is maxed out. If maxed out people going to use their own vehicles. People don't choose to use their own vehicles just because. They do it because currently it is less stressful than using the current bus service or there isn't a bus service for their respective area.

[pete]

Yes exactly. So, what they really need to do is buy more buses and hire more drivers. Once that's in place jam up the price of fuel. When people complain start to flood the roads with the buses that will cost them their old transport price and a lot of people will switch.

I know I will. There are two buses that work the area I live. I have only seen them parked up before they start to work and never on the road. My wife used to travel and she was never passed by the bus and sometimes would be waiting on transport from 5:50AM to 6:30AM.

Right now I drive approx. 50-60km/day to work and drop my wife to work in the morning and she travels home in the afternoon. That only costs us about $20 in transportation a day. If we were both to travel to work, that would cost me nearly $40. Why pay double for less convenience?

*edit* Why is buses running on diesel a problem? A bus holds like 50+ people in it. If 50 people drive a pickup each from sando to pos it will use like 10-20x more fuel than a single bus.

[janfar]

Yeah... well we got rid of sugar cane thinking all it was only good for tea... all now we could have had a processing plant for ethanol.

[VexXx Dogg]

Yeah... well we got rid of sugar cane thinking all it was only good for tea... all now we could have had a processing plant for ethanol.

Doh get me started on that one.
So much viable cane land, mismanagement bring down a whole industry yes....

[Ronnie203]

Subsidy Should NOT be removed......if anything it should increase
The country is generating more revenue in oil/gas now than before, export sales are higher.
Resources of this country does NOT belong to the PP Gov. it belongs to the people of this country and we should all benefit from this.

[janfar]

Oh... and the rapid rail should have never been scrapped but expanded to include other parts of the island. Using Natural Gas to make electricity to power the cabs.

Why not go a step further. In Russia they use electric powered buses for public transport utilizing overhead power cables. It may not be a perfect example because these buses are russian made and therefore ugly as feck but the idea is there.

Maybe one of you production guys can give us an idea of how much NG we have in reserve, including capped/ restricted wells.

[Dizzy28]

Subsidy Should NOT be removed......if anything it should increase
The country is generating more revenue in oil/gas now than before, export sales are higher.
Resources of this country does NOT belong to the PP Gov. it belongs to the people of this country and we should all benefit from this.

Just now you go want to drive in a service station and fill up for free!!