Guyana’s government is correct to view the current situation as one requiring critical thinking and analysis, rather than relying on slogans from social media.
President Irfaan Ali’s warning is clear: the war in the Middle East and the virtual blockage of the Strait of Hormuz have led to the largest single supply disruption in the history of the global oil market.
This situation has significant effects on the prices of fuel, food, and fertiliser around the world. In light of this, the government’s choice to keep the excise tax on fuel at zero is not a political stunt; it serves as a protective measure for a fragile economy facing global dangers.
The statistics illustrate the urgency. About one-fifth of the world’s seaborne oil and gas trade is currently at risk in a narrow waterway where insurance costs, freight charges, and risk margins have all increased sharply.
This chokepoint also transports a significant portion of the world’s LNG, LPG, and fertiliser, with urea and other materials already seeing significant price hikes. These increased costs won’t just stay at sea; they will appear on supermarket shelves, in electricity bills, and in the price of fertiliser that farmers need.
Global organisations are raising the alarm. The World Food Programme estimates that if the conflict continues, an additional 45 million people could face acute hunger this year. This would bring the total at risk worldwide in 2026 to around 363 million. For countries in Africa, Asia, the Caribbean, and Latin America that rely on imports, this risk is not hypothetical. It poses a real threat to foreign currency, food stability, and social order. In such circumstances, governments that delay or hesitate will cause the poorest to suffer the most.
Guyana has taken a more proactive approach. Since 2022, the state has kept the excise tax on gasoline and diesel at zero, giving up about $100 billion each year to maintain lower fuel prices at the pump than what global markets would dictate. By extending this policy into 2026, the government is cushioning the economy from external shocks, so that sectors like transport, agriculture, manufacturing, and everyday commuters do not have to bear the full impact of a conflict they did not initiate and cannot control. This is how oil revenues and fiscal space should be responsibly managed in a developing petro-economy.
Critics might say that more needs to be done or that different strategies are required, and it is beneficial to debate the best policy options. However, it is misleading to suggest that Guyana operates in isolation or that global disruptions in freight, insurance, and energy can be ignored with catchy phrases.
The government’s approach—constantly engaging, adjusting taxes, monitoring prices, and being ready with additional measures—is not perfect, but it is based on the realities of a connected world. In an era when a blockade across the globe can affect the price of bread in Guyana, the real failure would be to overlook these truths and refuse to take action.
