Fines of up to $6M for illegal fuel bunkering

Energy Minister Kevin Ramnarine announced on Thursday that says the subsidy on diesel fuel has been reduced by 22 per cent.And he said fines for illegal bunkering increased dramatically to as much as $6 million.

Ramnarine said the reduction in the subsidy means there would be substantial savings for the country, especially when calculated together with the rise of oil prices on the world market.

The minister noted that the ex-refinery prince of crude oil increased by 28 per cent increase between September last year and the end of January 2012, the same period that coincide with the cut in subsidy.

“So while we have been saving volumes on the one hand, the price of oil on the international market is pushing the ex-refinery price of diesel up,” Ramnarine said.

He told reporters attending the post cabinet media briefings that the ministry's research has shown that in the Caribbean region, the average retail price for diesel throughout the is TT$7.56 per litre.

“For 2011, in T&T the ex-refinery price for diesel was $5.15 but the population pays $1.50 per litre which is a difference of $3.65 so it means therefore, that when you buy a litre of diesel at your service station, the real cost is $5.15 but the government is subsidising to the tune of $3.65,” he explained.

He said difference in the price creates an opportunity for illegal bunkering and “a very lucrative, criminal industry in the making”.

He explained a new structure of fines for illegal bunkering:

• $500,000 for anyone caught with volumes not exceeding 40,000 litres
• $2M for between 40,000 litres and 160,000 litres
• $6M for volumes in excess of 160,000 litres

“So the fines have been dramatically increased because we feel the fines must be proportional to the value of the goods that are being seized and so on," the minister said.