The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

Bahamian gas station operators yesterday said they remain “optimistic” about their relief negotiations with the Government despite the two sides not having met or communicated for “quite a while”.

Vasco Bastian, the Bahamas Petroleum Dealers Association’s (BPDA) vice-president, told Tribune Business: “The Government is working behind the scenes to bring some type of resolution to the matter, and I don’t want to paint their efforts in a negative way because the Government has continued to do what they promised, and I’m happy with whatever negotiations they are doing behind the scenes but I haven’t spoken to them in a while.”

Petroleum dealers have been seeking a 50 percent per gallon of gas margin increase, which would take this from the present 54 cents to 81 cents. They want a revamp of their price-controlled, fixed-margin model which makes the industry purely a volume-driven business.

With higher oil prices increasing the sums they have to pay the three major oil companies for their fuel inventory, gas station operators say their gross margins are now to low to cover rents, employee payroll, and rising bank (overdraft and credit card) charges. As a result, some may be forced out of business.

The last margin increase was granted under the then-Free National Movement (FNM) administration of Hubert Ingraham in 2011. While global oil prices have fallen slightly, they remain relatively high, standing at $96.02 per barrel on the West Texas Intermediate index and at $104.5 for Brent crude. However, Senator Michael Halkitis, minister of economic affairs, has rejected the idea of a margin increase due to fears about the impact higher prices will have on consumers.

Mr Bastian said of the Government’s margin inflexibility: “The Government is entitled to do what it wants to do and I don’t know what they really want. I spoke to them a couple of months ago and, based on my communications with them, I am happy with what I left them with at that time and remain optimistic until we meet with them again.

“These type of policies could impact nationally, and the Government has to be careful and look at all of the different scenarios before they make a decision so I can respect that even though we are still having our challenges. The Government has a lot of issues going on. Our issues are on the table, and the Government has met with us several times and we feel positive that, at the end of the day, things will work out for everyone.”

Association members were said to understand this is a “waiting game” with the Government, and are being patient until it makes a decision. There will be no closure of gas stations, as was threatened over the Easter weekend, because there will be “no inconveniencing the public at this time”, Mr Bastian said.

He added: “I was always opposed to that closing down. I’m not in the business of closing down and providing additional hardship for the Bahamian people. The Bahamian people are the ones who keep us operating, and any closing down that will affect mother’s and children and people that depend on us, I was not going to be a part of that.”