Even though oil prices showed slight improvement yesterday, TOSL Engineering Ltd chief executive officer Shazan Ali says Government should exercise caution with its spending on capital projects. On Tuesday, the West Texas Intermediate (WTI) benchmark crude oil price was at US$81.28, up from Monday's price which had slipped below the US$80 a barrel. T&T's 2015 national budget is pegged on a per barrel price of US$80.
Ali told the T&T Guardian the dip in oil prices is a matter of concern, but not something the country should be too worried about."I do not see (an impact) in the short term. It is cause for concern, but we need to monitor it," Ali said.
"I do not think there is going to be that much effect. The oil prices were slightly under US$80. It has come down from a high of $110/$115 and our budget is based on an oil price of $80, so I think if it continues down, we will have to look at curbing some of our capital projects."
The TOSL boss, who spoke on the sidelines of the company's inaugural General Electric Bently Nevada day seminar at Cara Suites Hotel and Conference Centre, Claxton Bay, said falling oil prices should be a serious matter for Government.
"We should be concerned about it, and we should be making plans about what we are going to do if it drops further than that," he said.Ali said he is confident Government is reviewing and prioritising projects at this point, especially as oil prices hover near Finance Minister Larry Howai's projected US$80 a barrel price.He said he is "fairly confident and optimistic" that oil prices will rise again and oil and gas will drive the major economies.
"When I look at the global economy, even though Brazil is a bit slow right now in South America, China is still growing and India is still growing and the UK economy is positive. The US is growing."I think in the long run, oil will continue to be driving the economies of the world. I do not see alternate power driving economies of the world."