Latest update March 16th, 2026 10:23 AM
Oil price boom could bring billions but rising freight rates could increase food costs – WIN
(Kaieteur News) – The We Invest in Nationhood (WIN) on Friday warned that while rising global oil prices triggered by geopolitical tensions could generate billions of dollars in additional revenue for Guyana, higher freight costs may simultaneously drive-up food prices and the overall cost of living.
In a statement, the party said it was seeking to highlight both the opportunities and risks facing Guyana’s economy as tensions in the Middle East continue to influence global oil markets.
WIN noted that Guyana is currently producing about 900,000 barrels of oil per day, and a US$30 increase in oil prices could have significant financial implications for the country.
“Under the current production arrangements, Guyana receives approximately 14.5 per cent of the value of production through its royalty and share of profit oil. Based on current production levels, a US$30 increase in oil prices could generate roughly US$4 million in additional revenue per day for Guyana,” the party said.
At an exchange rate of GYD$208 to US$1, this translates to approximately GYD$830 million daily, or more than GYD$300 billion annually if such price levels persist.
However, WIN cautioned that the same geopolitical tensions pushing oil prices higher could also disrupt major global shipping routes, particularly the Strait of Hormuz, one of the world’s most critical maritime passages.
According to the party, instability in shipping lanes tends to increase freight charges, raise insurance premiums and disrupt global supply chains—factors that could significantly impact countries like Guyana that rely heavily on imported food, agricultural inputs and consumer goods.
“Food alone accounts for more than one-third of the cost of living in Guyana. When global freight costs rise, food prices are often among the first to increase, placing immediate pressure on household budgets,” WIN said.
The party stressed that while government revenues may rise quickly with higher oil prices, ordinary citizens could simultaneously face higher living costs.
To cushion potential impacts, WIN suggested several measures, including establishing a temporary freight stabilisation mechanism for essential imports such as flour, cooking oil, fertiliser and animal feed.
The party also recommended targeted tax or VAT relief on key food items, as well as using part of the additional oil revenue to expand fertiliser and agricultural input subsidies to help reduce production costs for farmers.
WIN further urged the government to strengthen strategic food supply systems to prevent global disruptions from immediately triggering price shocks locally.
“The reality is straightforward. When oil prices rise, government revenues increase almost immediately. But when food prices rise, the burden falls immediately on households,” the party said.
It added that if Guyana stands to earn hundreds of billions of dollars more from higher oil prices, the real test of governance will be whether that wealth is used to shield citizens from rising living costs.
“If oil prices rise and Guyana earns hundreds of billions more, the real test of governance is simple: will that wealth protect the people from rising prices, or will the people continue to bear the burden while the country grows richer on paper?” the party said.
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