President Luis Abinader said that his government has not had the cushion of the Petrocaribe preferential oil prices that benefited the governments of the Dominican Liberation Party (PLD). He said that the past authorities never paid for a barrel of oil more than US$50 thanks to the alliance with the Venezuelan government oil suppliers.
“If I had Petrocaribe, things would be different. We would have the lowest fuel prices. Because before they only paid it at 50 dollars, however, it was sold at 70 and they also had a profit with an extra tax,” he told a journalist.
The President said that from 2015 to 2020 the price of crude oil remained below this price in the international markets. He explained that Petrocaribe allowed the government to pay no more than 50 dollars per barrel, and when it exceeded that price the oil shipments were financed at a very low interest rate. The people, nevertheless, paid for the fuel as if the government was buying the fuel at 70 dollars per barrel.
The head of state indicated that as a consequence, the government and the Dominican people are currently paying the government debt taken on by the past government for the fuel purchases from Venezuela.
Francisco Tavarez, of the economy committee for the opposition party Alianza Pais, also attributed the high fuel prices to the heavy dependency of the government on fuel taxation and the mafias that still operate in the sector. As reported in N Digital, Tavarez mentioned an effective tax rate of 35% on the final price. He said the import parity price that is opaque needs to be added. He said the government has not wanted to crack down on the mafias that determine it.
President Luis Abinader had promised to submit to Congress a hydrocarbons bill to reformulate the way fuel products are priced but has yet to do so.
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El Dia
N Digital
7 February 2022