Akash Sama­roo

Se­nior Re­porter

akash.sama­roo@cnc3.co.tt

As the glob­al prices of oil fail to surge, Min­is­ter of En­er­gy and En­er­gy In­dus­tries, Dr Roodal Mooni­lal, says a spike in prices was nev­er a cer­tain­ty.

Af­ter ten­sions rose and mil­i­tary ac­tion in­ten­si­fied be­tween Is­rael and Iran last week, some ex­perts had pre­dict­ed a sharp rise in oil prices, giv­en that Iran is one of the world’s lead­ing oil pro­duc­ers and any dis­rup­tion to its ex­ports could neg­a­tive­ly im­pact glob­al sup­plies.

In the Low­er House on Mon­day, Mooni­lal said this could lead to huge fi­nan­cial ben­e­fits to this coun­try but lament­ed that a mas­sive fi­nan­cial wind­fall was hin­dered by the pre­vi­ous ad­min­is­tra­tion’s fail­ure to keep oil pro­duc­tion up.

How­ev­er, at mid­day yes­ter­day, WTI (West Texas In­ter­me­di­ate) and Brent crude had a per bar­rel price of US$65.42 and US$68.14 re­spec­tive­ly.

Be­fore the con­flict es­ca­lat­ed on June 13, the prices were US$68.00 (WTI) and US$69.65 (Brent).

But Mooni­lal told Guardian Me­dia he nev­er said in Par­lia­ment that a price in­crease was cer­tain, as it would al­ways de­pend on sev­er­al fac­tors out­side of this coun­try’s con­trol.

“I was very clear about that in my pre­sen­ta­tion. I made the point that the ex­pec­ta­tion of high oil prices has to do with the con­flict and the buildup of that con­flict be­tween Iran and Is­rael and the po­si­tion­ing of the Unit­ed States and oth­er West­ern al­lies. One has to mon­i­tor on a dai­ly ba­sis, I be­lieve, the price of oil and gas em­a­nat­ing from this mat­ter, as we all know there are se­ri­ous is­sues of block­age and the is­sue of the clo­sure of the Strait of Hor­muz and now there is some dis­rup­tion in the Red Sea. So, one mon­i­tors that,” the min­is­ter ex­plained.

Mooni­lal added, “It’s not that one can an­tic­i­pate with 100 per cent ac­cu­ra­cy what will be the price of oil to­mor­row. No­body knows that. And that was the point I was mak­ing, that it is volatile and un­pre­dictable.”

Sev­er­al fac­tors have pre­vent­ed a sus­tained price in­crease, the most sig­nif­i­cant be­ing the rapid de-es­ca­la­tion and a re­port­ed cease­fire be­tween Iran and Is­rael. There has al­so been no di­rect im­pact on oil flows. A ma­jor con­cern was the po­ten­tial for Iran to block the Strait of Hor­muz, a crit­i­cal choke­point through which a sig­nif­i­cant por­tion of the world’s oil pass­es. How­ev­er, Iran did not dis­rupt the flow of oil through the strait, large­ly be­cause it al­so re­lies on this wa­ter­way to ex­port its own crude. The ab­sence of such a dis­rup­tion al­le­vi­at­ed fears of a se­vere sup­ply shock.

Mean­while, for­mer En­er­gy Min­is­ter Stu­art Young told Guardian Me­dia that T&T is a price tak­er and there­fore has no in­flu­ence over glob­al oil prices.

Young then sought to clar­i­fy the claim that the for­mer ad­min­is­tra­tion was un­able to keep oil pro­duc­tion lev­els high. Mooni­lal chas­tised the for­mer gov­ern­ment for that, say­ing there was a 37 per cent de­cline dur­ing the Peo­ple’s Na­tion­al Move­ment’s (PNM) al­most 10-year term.

Young said, “The PNM ad­min­is­tra­tion did not ‘cut back’ on oil pro­duc­tion. Un­for­tu­nate­ly, a com­bi­na­tion of fac­tors, in­clud­ing be­ing a ma­ture province, has led to oil pro­duc­tion de­cline since 2010. We had con­sis­tent­ly in­struct­ed Her­itage to seek to in­crease oil pro­duc­tion and had worked on farm­ing out fields to in­de­pen­dent pro­duc­ers in an ef­fort to in­crease oil pro­duc­tion. Min­is­ter Mooni­lal talks a lot but pro­duces very lit­tle and I ex­pect that to be his score­card. Nev­er­the­less, as a cit­i­zen, I would be hap­py to see oil pro­duc­tion in­crease.”

He said he ex­pects off­shore oil pro­duc­tion to in­crease due to work the PNM did with Peren­co and EOG.

But as Min­is­ter Mooni­lal con­tin­ues to meet with in­ter­na­tion­al en­er­gy com­pa­nies to ful­fil his man­date of mak­ing this coun­try the en­er­gy hub of the re­gion, Young of­fered some cau­tion­ary ad­vice.

“I see Min­is­ter Mooni­lal is meet­ing with Russ­ian com­pa­nies and that has se­ri­ous im­pli­ca­tions in Wash­ing­ton DC.”

To this, how­ev­er, Mooni­lal replied, “The com­pa­nies we met are com­pa­nies that are in­volved in Grena­da. The com­pa­ny is ac­tu­al­ly reg­is­tered in Grena­da and that is the com­pa­ny do­ing the ex­plo­ration work off the coast of Grena­da, which is close to Trinidad and To­ba­go wa­ters as well. And we have in­ter­est, of course, in part­ner­ing with Grena­da on that sig­nif­i­cant en­deav­our.”

Mooni­lal sought to point out what he called the hypocrisy of Young’s warn­ing.

“I find it strange that such a com­ment came from for­mer Min­is­ter Stu­art Young, who was, you know, frol­ick­ing with per­sons who were sanc­tioned by the Unit­ed States and en­cour­aged and wel­comed a per­son who was sanc­tioned by the US on a sanc­tioned jet as well. So, Mr Young re­al­ly has no moral au­thor­i­ty to speak about im­pli­ca­tions of ac­tions in terms of Wash­ing­ton, DC.”