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Jan 24, 2017

Decoding Gas Prices After Premium and Regular Reach Same Levels

Last week, News Five went on the hunt looking for answers as to why regular and premium gasoline happened to be the exact same price in Belize City: nine dollars and ninety-one cents. Prices have stabilized somewhat after a series of hikes in early 2016, caused by Government increasing import duties to combat a fifty-million-dollar revenue shortfall particularly and ironically coming from ever-reducing earnings from locally produced crude oil. According to the Ministry of Finance, almost four of every ten dollars paid at the pumps goes to taxes for the Government, a rise of ten percent from July of 2015. We caught up with general manager for SOL Belize Limited, Rufino Lin, at another event today and he explained what’s behind the unusual pricing and customer preference.

 

Rufino Lin

Rufino Lin, General Manager, SOL (Belize) Limited

“The pricing of fuel in Belize is regulated; Government determines the Belize City pump price through taxation, and the district pump prices are then determined by freight; so the further away you are from Belize City, the more you pay per gallon in the freight component in the price.”

 

Reporter

“And that would account for the differences in price, but how is it that both prices for premium and regular gasoline could come to the same amount, and in that case, do you see any customer preference?”

 

Rufino Lin

“When regular and premium prices are different – and when I say different I mean that regular is lower than premium, we see a trend of [higher] regular sales; people prefer the regular, it’s less expensive. But when you have a situation where regular and premium [gasoline] are similar or very close in price, then obviously the customer preference is to use premium; so customer preference is premium when the premium and regular are basically close in price.”

 

Any ease at the pump, says Lin, will depend on the Government’s attitude to reducing its bite of the costs. 

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