Gas price down, minibus fare to drop

Oct 30, 2008 News

…retail price is now $777 a gallon

The General Mini Bus Association (GMBA) and the Guyana Public Transportation Association (GPTA) yesterday committed to reducing the minibus fares in the country as a result of the drastic reduction in gasoline prices at the Guyana Oil Company.

This is according to President of the GMBA, Lylon Weithers, and Public Relations Officer of the GPTA, Compton Giddings, following a meeting with Minister with responsibility for Commerce Manniram Prashad, yesterday.

A specific new price has not been determined but the bodies are expected to meet with their constituents.

Minister of Finance, Dr. Ashni Singh yesterday announced that Government had granted approval for the prices for fuel sold by the Guyana Oil Company Limited to be reduced with immediate effect in light of falling oil prices on the world market. The lower gasoline prices took effect as of 14:00hrs yesterday.

According to Minister Singh, gasoline will be retailed at $777 per gallon, which represented a 20.7 percent reduction from the previous price of $980 at Guyoil; diesel is expected to be retailed at $791 per gallon, a 20.2 percent reduction from the previous price of $991; and kerosene is expected to be retailed at $623 per gallon, a 30.6 percent reduction from the previous price of $898.

Dr Singh explained that the government’s decision to implement the reductions stemmed from the considerable decline observed in oil prices on the world market in recent days and weeks.

He also indicated that in accordance with the stabilising mechanism that has been utilised by Government in relation to fuel prices and taxes, the excise tax on gasoline would be adjusted to 50 percent and on diesel to 30 percent, pointing out that the 30 percent rate on diesel is a highly concessional rate compared to the 50 percent standard rate on this commodity.

Minister Singh emphasised that Government would be maintaining its policy of charging no taxation on kerosene. He explained that the price reductions were approved with the strong expectation that the final consumers would benefit directly.

In this regard, he drew attention to the call made recently by President Bharrat Jagdeo that public transportation operators would be expected to reduce the fares charged to the traveling public if fuel prices were reduced.

The last fare increase introduced by public transportation operators was advocated at the time when gasoline prices exceeded $1,000 per gallon.

Yesterday, Minister Prashad also said that the reduction represented a 20 per cent reduction in gasoline and urged that the minibus umbrella bodies in their deliberations should aim for a proportional reduction.

In October, the minibus associations announced a fare increase and released a fare structure that went into effect. The body had justified the increase saying that the hike was inevitable against the backdrop of skyrocketing prices for fuel and essential spare parts.

The short drop fare for minibuses was increased and is still in operation at $80, up from $60. The fare for longer destinations was also increased.

Fuel price on the world market had increased to as much US$147 but has plummeted to a 17-month low of $61.

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