Prices jump as gov’t ends fuel subsidies

ST JOHN’S, Antigua & Barbuda: Following the government’s announcement that it has ceased fuel subsidies, the price of gas, diesel and cooking gas have increased.

Harold Lovell, Minister of Finance and Economy, announced last weekend that the price of gasoline has been increased from EC$9.50 (US$3.54) per gallon to EC$11.50 (US$4.29). Diesel, which previously cost the same as gasoline, is now EC$10.90 (US$4.07) per gallon and the cost of LPG (cooking gas) has also increased significantly. A 20-pound cylinder of cooking gas has jumped from EC$20.95 (US$7.82) to EC$32 (US$11.94), while a 100-pound cylinder that previously cost EC$108 (US$40.30) now sells at EC$155 (US$57.84).

All three fuel products were previously subsidized, according to Lovell, to the tune of EC$40 million (US$14.9 million) in 2008.

“The government cannot continue to use revenue collected from other taxes to subsidize the retail price of petroleum products,” Lovell said, explaining that the costs will now be adjusted with every shipment, based on the average cost of the three most recent shipments of the commodities.

“Subsidies are necessary but must be distributed to ensure the greatest good to the greatest number and targeted towards educating our youth, caring for the elderly, stimulating the productive sectors of our economy and providing relief for the most vulnerable groups in society,” Lovell said.

Lovell added that the government would seek, where possible, to reduce the effects of high fuel prices on the most vulnerable groups in society. 

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