Young: $1b in petroleum subsidy

ENERGY Minister Stuart Young said on June 3 the 2024 petroleum subsidy will be about $1 billion, a figure that is down from $1.6 billion and $1.8 billion for the two years prior.

He spoke at a sitting of the Standing Finance Committee of the House of Representatives. About half the sum was allocated in the budget, and half in this week’s Mid Year Review.

The Government pays a sum each year to subsidise the price of gasoline paid “at the pump” by drivers.

With refined gasoline being imported at world market prices, the subsidy paid each year will vary according to how high or low the global price moves.

The committee considered a supplemental allocation of $570.9 million to the Ministry of Energy’s budget, to fully fund the fuel subsidy.

Couva North MP Ravi Ratiram asked how this sum would be divided between petroleum retailers NP and Unipet.

Young replied that the sum of almost $571 million was solely to be used to pay the fuel subsidy.

“In 2022 the fuel subsidy that was paid by the taxpayers of Trinidad and Tobago towards fuel at the pump was $1.67 billion. In 2023, it was $1.845 billion.”

He said for 2024 it was projected to be $1 billion.

“We had in the original budget allocation $500 million which obviously is a shortfall, so this sum of money ($570.9 million) is going to go wholly towards the subsidy.”

Young said the money was to be paid to wholesaler Paria Fuel Trading Company as it imports refined fuels for the people of Trinidad and Tobago.

He said it was premature to seek a breakdown between NP and Unipet. Young also said each retailer owed the State money from the last fiscal year.

In a statement sent to Newsday by WhatsApp, Young said, “The budget allocated $500 million to the subsidy.

Today the $570.9 million is additional to that. The annual subsidy is projected to be more than $1 billion.

“The amount of $570.9 million will be used towards the subsidy which is a rolling account and this year’s payments cover part of the last fiscal’s accruals.”