Already facing hardships from the last petroleum price increase, secretary of the Petroleum Dealers Association Saleema Sattar said petroleum retailers may have no choice but to close down their businesses or fire employees in the coming months.
In a telephone interview after Finance Minister Colm Imbert made his presentation, Sattar said the incremental removal of subsidy and increased price of diesel did not provide any economic gains for retailers or wholesalers of petroleum.
She said retailers have been getting a fixed 12 cents per litre of fuel since November 2005, so even though fuel prices went up, there was no profit to be made.
Wholesalers get 14.5 cents per litre, Sattar said.
"Now that diesel price has gone up, people will close up their businesses. I run a service station and after I pay for my fuel, pay taxes and rental to NP and pay my employees, I am left with nothing. It is really a desperate situation," Sattar said.
She noted that the 200 per cent increase in Business Levy Tax affected the gas station owners.
"This has presented a significant strain on our sector. It is more difficult now to operate business. With the removal of the subsidy, there should have been a way for us to make a profit but we cannot," Sattar said. T&T has 170 service stations in T&T, of which 20 are operated under the Unipet brand and the remaining 150 operate under the terms of State-owned National Petroleum Co Ltd (NP). Sattar called on Government to meet with the Petroleum Dealers Association to discuss the economic ramifications of the removal of fuel subsidies.
Imbert announced the new price of diesel fuel at $2.30 per litre up from $1.98 per litre effective immediately yesterday.
Saying diesel increases will cause transportation costs to jump, Sattar said this will mean increased food prices, as the majority of trucks transporting food are run on diesel fuel.
Sattar said the Petroleum Dealers Association was looking forward to seeing the Petroleum Order Paper to determine whether there is an increase in the margin for retailers and wholesalers.
President of the Energy Chamber of T&T Thackwray Driver in an interview after the Budget said there should be a liberalised system of fuel prices. He said this would ensure that petroleum dealers got a fair market price rather than operating under a price control system.