October 31, 2020

The Editor Speaks: Gas talk gets nowhere so gas companies will have commission

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Colin Wilsonweb2It was only a matter of time before the gas companies in the Cayman Islands gassed themselves out.

The general public has been really fed up with the Rubis and Sol gas monopoly (formerly Chevron-Texaco and Esso) and the high price we pay here for their gas.

There is little or no competition between the companies and secrecy surrounding the markups these companies reap has been the subject of many complaints and government frustrations.

The talking is now over says Minister Kurt Tibbetts whose portfolio the gas companies are under.

Tibbetts’ frustration was evident when he spoke during a debate over a members’ private motion filed by Opposition Leader McKeeva Bush that sought to expand the authority of the Cayman Islands Petroleum Inspectorate to include subpoena powers to “ensure market prices are passed on to the general public.”

In the USA the reduction in gas prices were well below the $1.50 per gallon we received here and Bush said the local gasoline and diesel importers would like to think we should be jumping with joy but the prices we pay at the pump are “artificially inflated”.

Tibbetts 100% agreed with him. He said it has been difficult to almost impossible to obtain what the actual markups the two companies are claiming because of a “fancy word called proprietary that they use and they still use it today”, he said. He hoped they were listening because “I don’t believe a word they tell me about their markup.”

So now the two companies have brought upon themselves “The Public Utilities Commission”. This Commission will be given the authority to order petroleum distributors to reveal their “pre-markup” fuel prices.

Two ‘markups’ occur – from when the fuel leaves the supplier’s shores and arrives here in Grand Cayman for storage at the fuel terminal at Jackson Point, South Sound Road, George Town, and the other is at the pumps.

Tibbetts said, “The Petroleum Inspectorate will have proper legislation in place which guarantees their ability to get this information.”

Of course we now hear from the fuel companies that over regulation could mean consumers could be left out of retail savings that occur.

What retail savings? As there has been hardly any regulating at all one cannot say that putting in place for the very first this commission is over regulation!

And we all know Cayman is smaller than the USA. We all know about the 4 weeks fuel shipments that always result in us waiting 4 weeks before the price goes down in the USA. We also are aware when the price goes up in the USA it amazingly always coincides with an immediate shipment here.

However, the fuel companies don’t have to worry for a while.

Nothing government says they are going to do happens at a stroke of a pen.

We either have to have a committee set up to look into anything proposed or we have to employ a consultant and often both.

What’s that?

“The most arduous task will be doing the necessary legislation,” Tibbetts said.

To assist in amalgamating all the different regulatory functions a consultant has been hired on a three-month contract to “develop the framework” for the Public Utilities Commission.

The hurricane season is also hard on our heels. If the lower prices remain we should reap the benefits as the fuel companies say they keep the inventories at higher levels and we also use less fuel.

I wait for the evidence on that. But it might be a long wait. Prices are rising again in the USA by 20 cents and today here in Cayman over 30 cents has been quickly added to our pump prices! And none of us are surprised.

And all the fuel companies had to do was to reveal their markups.

I wonder why they are very hesitant to do that?

They say we must not use comparisons with the USA?

I wonder why they say that?

Nah. I’m not.

They think we’re all fools. They think we buy into all this.

Hopefully, their days are numbered.

Their gas is overpriced and the gas they talk will be commissioned. I hope it will be soon.

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