THE Private Sector Commission said it remains concerned that fuel prices in Guyana are not reflective of the global trends where prices are low, and fears that the competitiveness of local manufactures, farmers and service providers will be lost if urgent action is not taken. In a statement the PSC said that if these trends continue, imports will be cheaper on the local markets and certain local production will diminish whilst exports will be more expensive. “With record lows in oil prices being translated into low prices at the pump in most countries, Guyanese consumers and manufacturers are still paying almost US$4.50 per gallon, which is almost double the prices in some developed economies.”
“The Private Sector Commission calls upon government to review the prices of fuel, in particular at the state owned Guyana Oil Company, and consider a reduction in electricity rates so that the benefit of the lower oil prices can provide relief to consumers who are suffering from reduced disposable income.” According to the PSC, at this time when the economy is still reeling from the effects of the elections-induced slowdown in 2015, lowering the cost of fuel and electricity would provide a much needed stimulus to the recovery of the sluggish economy.
Back in August last year Finance Minister Winston Jordan had announced a reduction in fuel prices at the state-owned Guyana Oil Company (GuyOil). This was in sync with the prices for fuel on the international market at that time, which had dropped drastically. Jordan revealed then that diesel will be retailed at $168 down from $174 while gasoline will be sold at $199 down from $210.
Reuters news agency reported on Monday that a renewed slump in oil prices due to a persistent global supply glut hurt U.S. and European stock markets on Monday and weighed on the dollar following a rebound in those sectors late last week.
Anxiety over the impact of tumbling energy prices on global economic growth and central bank policies revived safe-haven demand for the yen, gold and U.S. and German government debt. Crude oil prices fell as much as 6.7 percent as Iraq announced record-high oil production that will feed into an already oversupplied market, wiping out much of the oil price gains from off the biggest-ever daily rallies on Friday.
Reuters also reported that the oil-led market turbulence since the start of 2016 has raised hopes of more stimulus from major global central banks. Last week, European Central Bank chief Mario Draghi signaled the bank was open to more monetary stimulus to combat weak growth and inflation in the euro zone. Global markets slumped at the start of the year on fears that a slowdown in world No. 2 economy China, would spread to the rest of the world, and oil prices sank to a 13-year low.