Guyana defends increase in fuel prices

GEORGETOWN, Guyana, CMC – The Guyana government has blamed rising global oil prices for the increase in fuel prices, even as the Irfaan Ali administration says it has been absorbing billions of dollars in a bid to cushion the population from the impact.

Finance Minister Dr Ashni Singh, addressing the recent increases in fuel prices, said that Guyana, despite being a crude oil producer, still imports refined fuel products from the international market and is therefore affected by fluctuations in global oil prices.

“As a result of global developments, the world market price for oil has been increasing in recent weeks and months,” Singh said, adding that the government has implemented several measures to protect consumers from the full impact of those increases.

He said among those measures was the complete removal of excise taxes on fuel, noting that the move has resulted in savings of approximately GUY$100 billion annually for Guyanese consumers.

“At a micro level, Guyanese consumers are saving about GUY$500 per gallon of diesel or gasoline purchased at the petrol station,” he said.

Singh added that the government has also absorbed higher fuel costs incurred by the Guyana Power and Light Incorporated (GPL) and the Guyana Water Incorporated (GWI), both of which rely heavily on fuel for their operations.

He said electricity tariffs have remained unchanged despite higher operational costs because the government intervened financially to prevent increases from being passed on to consumers.

“We have said we will not pass on those increases through electricity tariffs,” Singh said, noting that increases at the fuel pumps in Guyana have been significantly lower than the actual rise in global crude oil prices because of deliberate policy interventions by the government.

He said the government remains committed to cushioning citizens from global economic shocks while maintaining stable utility costs.

Meanwhile, President Ali is urging public transportation providers and other stakeholders to act responsibly and avoid excessive fare increases.

His appeal comes after Public Works Minister Bishop Juan Edghill said the government had “neither approved nor sanctioned” any increase in fares across all modes of public transportation and that “no driver has the authority to put a passenger out of their vehicle for refusing to pay unapproved fares”.

In a statement, President Ali reiterated a position outlined by his Finance Minister that Guyana, despite being a major crude oil producer, still relies heavily on imported refined fuel products.

“You would recall that the Government of Guyana removed the excise tax on imported refined products to zero,” President Ali said, adding that minibus operators, taxi services, speedboat operators, truckers, farmers, and businesses all benefited substantially from the zero-rated excise tax.

“For minibuses operating in Georgetown and consuming an average of more than 12 gallons of fuel per day, the policy delivered savings of about GUY$6,000 per day directly,” he said, noting that despite those interventions, there had been no corresponding reduction in transportation fares when fuel prices previously declined as a result of government measures.

As a result, he said, the government now expects transport operators and suppliers of public services to demonstrate social responsibility during the current period of global volatility.

“We expect that all of the operators will reduce their profit lines so as to mitigate that impact,” he said, adding that the state-owned fuel supplier GUYOIL has already reduced its profitability significantly in an effort to maintain balance in local fuel prices.

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