At yes­ter­day's post-Cab­i­net news con­fer­ence, Min­is­ter of En­er­gy and En­er­gy In­dus­tries, Dr Roodal Mooni­lal, pro­vid­ed the first of­fi­cial cal­i­bra­tion of the pos­si­ble im­pact of the on­go­ing war in the Mid­dle East, sug­gest­ing that T&T is not go­ing to be the ben­e­fi­cia­ry of a wind­fall due to high­er oil and nat­ur­al gas prices.

With the bench­mark Brent crude oil trad­ing above US$82 a bar­rel yes­ter­day, the min­is­ter said if the US$12 in­crease is sus­tained, at the Gov­ern­ment's 50 per cent tax rate, T&T could gen­er­ate an ad­di­tion­al US$10 mil­lion a month in oil rev­enue.

He al­so said any in­crease in en­er­gy rev­enues the coun­try re­ceives from high­er prices of crude oil ex­port­ed by whol­ly state-owned Her­itage Pe­tro­le­um Com­pa­ny, is like­ly to be off­set by the in­crease in the Gov­ern­ment's sub­sidy on liq­uid fu­els, which are im­port­ed by whol­ly state-owned Paria Fu­el Trad­ing.

While the prices of liq­ue­fied nat­ur­al gas (LNG) have sky­rock­et­ed this week in Eu­rope and Asia, the most Dr Mooni­lal said of At­lantic LNG's ex­ports of the com­mod­i­ty to the world is that T&T could see a "bump" in rev­enue. He said the min­istry had not yet com­plet­ed its cal­cu­la­tions on the im­pact of high­er LNG prices on T&T's tax rev­enues.

By his de­meanour, tone and choice of words, the min­is­ter com­mu­ni­cat­ed that the pop­u­la­tion should curb its en­thu­si­asm about the pos­si­bil­i­ty that T&T could soon be the re­cip­i­ent of huge sums of ad­di­tion­al for­eign ex­change rev­enue that would ban­ish all of this coun­try's prob­lems.

Dr Mooni­lal's fram­ing of the rev­enue is­sues con­veyed the right mes­sage at the right time. That is be­cause no one knows how long the Mid­dle East war will last and the im­pact on the glob­al econ­o­my go­ing for­ward.

It is al­so im­por­tant to re­call that in Feb­ru­ary 2022, short­ly af­ter the first Russ­ian bombs land­ed in Ukraine, an­a­lysts in T&T were cal­cu­lat­ing the in­cre­men­tal rev­enue this coun­try could earn from that war.

Not long af­ter­wards, trade union lead­ers were es­ti­mat­ing the ex­tent to which they could in­crease their wage de­mands of em­ploy­ers. And some re­tail­ers were al­so set­ting up to widen mar­gins on im­port­ed prod­ucts.

All of these pre­ma­ture prog­nos­ti­ca­tions were up­end­ed when the war in Ukraine caused re­al sup­ply chain dis­rup­tions around the world, which re­sult­ed in the cost of sea trans­port es­ca­lat­ing to eye-wa­ter­ing lev­els. The out­come was that the price of all of T&T's im­ports in­creased, putting ad­di­tion­al pres­sure on the many work­ers in this coun­try who, at that time, had not had ad­just­ments in their com­pen­sa­tion pack­ages in sev­en or eight years.

Even if the cur­rent war in the Mid­dle East leads to a rev­enue wind­fall, T&T's his­to­ry in­di­cates that our lead­ers need to be ju­di­cious in how that ex­tra mon­ey is spent.

Go­ing back to the 1973 oil em­bar­go im­posed by the mem­bers of the Or­ga­ni­za­tion of Pe­tro­le­um Ex­port­ing Coun­tries (OPEC) on West­ern oil im­porters who sup­port­ed Is­rael dur­ing the Yom Kip­pur War, it is clear that T&T, like all oth­er oil-ex­port­ing coun­tries, re­ceived huge in­creas­es in rev­enue as the price of the com­mod­i­ty more than tripled be­tween De­cem­ber 1972 and De­cem­ber 1973.

In­fla­tion climbed from 9.30 per cent in 1972 to 14.81 per cent in 1973 be­fore reach­ing a peak of 22.02 per cent in 1974 fol­low­ing the OPEC oil em­bar­go.

It was T&T's fi­nan­cial ex­u­ber­ance in the 1970s that led the late Ja­maica prime min­is­ter, Michael Man­ley, to say that mon­ey passed through this coun­try like a dose of salts.

No one should wish that in­fla­tion­ary night­mare on T&T again.