Skerrit responds to RUBIS suspension of fuel sales
RUBIS West Indies Limited, Dominica announces the suspension of fuel sales to its customers following significant financial losses incurred since entering Dominica in 2011 and which have accrued at an even greater pace over the past six years.
The information was presented in a statement dated September 15, 2022.
According to the statement, these losses are due to highly unfavourable mandated fuel prices, which are below the true importation value of fuel. A similar action had been announced by RUBIS Dominica in 2021. However, at that time, the Government of Dominica agreed to implement some changes to the regulated prices aimed at partially restoring the profitability of the fuel distribution business in this market, with further actions promised for the first quarter of 2022.
“ Unfortunately, the Government of Dominica has not taken any further actions to restore the profitability of the fuel distribution business and RUBIS Dominica has continued to incur significant losses as a result,” the statement said. “Regrettably, the regulated fuel prices that have been in effect for most of 2022 continue to be substantially below the true cost of importing fuels, and therefore, petroleum products are heavily subsidized by RUBIS and other fuel importers.”
The statement went on to announce that RUBIS Dominica will continue to engage with the Ministry of Trade, Commerce, Entrepreneurship, Innovation, Business, and Export Development to seek the implementation of a regulated pricing structure that would reflect the true cost of importing fuels into Dominica and would generate a reasonable return on the fuel distribution investments in the country.
RUBIS Dominica said it will resume fuel sales when such a price structure is implemented and wishes to clarify that it has allowed its Retailers to continue to sell fuel to the driving public at RUBIS Service Stations through our fuel dispensing equipment.
“However, as the fuel will no longer be supplied by RUBIS Dominica during this period of suspension, we cannot guarantee that fuel sold at our branded stations will be of the same quality as our Ultra Tec fuel,” the statement revealed.
RUBIS Dominica wishes to convey its heartfelt gratitude and sincere appreciation to its employees, retailers, retail, commercial and industrial customers, and the people of Dominica, all of whom welcomed RUBIS when the company began operations here in 2011 and have supported RUBIS ever since.
Meantime, in responding to the RUBIS Dominica statement on the fuel sales suspension, Prime Minister Roosevelt Skerrit said during a live interview on State-Owned Radio DBS on Thursday, that there is no need to panic.
“There is no need to go into any panic buying,” he said. “If you have to [fill] up your tank you should go in and do that, but there is no need to go ahead and fill containers and store petroleum products at your home.”
The Prime Minister indicated that his government is aware of the situation and is in fact putting contingencies in place to deal with this matter.
He explained that since 2003 the government has had a price mechanism in place with the support of the suppliers of petroleum products in Dominica.
“Since then there are other countries in the Caribbean who have adopted that price mechanism…,” he explained. “We started first of all with having the price changed every eight weeks, this was further reviewed on the request of suppliers of petro products in Dominica to four weeks, where every four weeks there is a change in the price.”
Skerrit continued, “If the price goes up in the international market it goes up, if it goes down as we saw in the last four weeks…the price went down in the international market, it went down in Dominica.”
He further explained that there is an average that is used.
Skerrit indicated that his government met with RUBIS last year and early this year and what RUBIS is saying is that it needs to have an increase in its profit margin, “RUBIS has claimed that they have been losing.”
“It’s not that we are selling the petroleum products less than what it is imported into the country, but they are asking for an increase in the profit margin,” he remarked.
He continued, “We did give an increase early this year, but we have always said to RUBIS and others that one has to be mindful of the global reality and we cannot go ahead and give you an extreme increase in the profit margin in one-fell stroke, let us take it in a systematic way.”
The Prime Minister stated that unfortunately, there is war in Russia and Ukraine and what his government has also done to help cushion the impact is paying 85c for every gallon per gasoline to the suppliers.
Prime Minister Skerritt responds to RUBIS statement of suspension of fuel sales Dominica News Online
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