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Saturday, June 28, 2025

Min­is­ter, en­er­gy an­a­lysts:

Higher oil prices a mixed blessing

by

GEISHA KOWLESSAR ALONZO
14 days ago
20250614
Minister of Energy and Energy Industries Dr Roodal Moonilal

Minister of Energy and Energy Industries Dr Roodal Moonilal

Roberto Codallo

Is­rael’s at­tacks on Iran’s nu­clear fa­cil­i­ties yes­ter­day has led to in­creas­es of more than sev­en per cent in the in­ter­na­tion­al price of crude oil.

How­ev­er, this may not sig­nif­i­cant­ly im­pact the lo­cal in­dus­try.

Min­is­ter of En­er­gy Dr Roodal Mooni­lal told Guardian Me­dia yes­ter­day that while the in­ci­dent has pro­voked in­creased prices, T&T may not see the ben­e­fit due to low pro­duc­tion lev­els.

He said one of the main ar­eas of pol­i­cy fo­cus for the Gov­ern­ment is in­creas­ing oil pro­duc­tion.

“There is a lot of po­ten­tial, but we need the in­vest­ments to hap­pen, and this is some­thing that we are ac­tive­ly dis­cussing with all the oil pro­duc­ing com­pa­nies in­clud­ing Her­itage Pe­tro­le­um,” Mooni­lal said.

The flip side to this, he said is that since the last gov­ern­ment shut down the re­fin­ery, T&T is now im­port­ing fu­el in­clud­ing gaso­line and diesel.

“This means Paria will have to pay more for the fu­el it im­ports,” the min­is­ter said, adding that the min­istry would mon­i­tor the sit­u­a­tion as it un­folds in the oil mar­kets.

The need for a fur­ther push from Her­itage was echoed by for­mer en­er­gy min­is­ter Kevin Ram­nar­ine.

“It is not go­ing to be any­thing to shout about be­cause our pro­duc­tion of oil, as has been point­ed out by many com­men­ta­tors, is at a low last seen in the 1930s...It (Her­itage) has the great­est po­ten­tial to re­alise that in­crease in pro­duc­tion. But what we have seen is that for many years, we’ve heard many promis­es from Her­itage Pe­tro­le­um ex­ec­u­tives in the past about in­creas­ing oil pro­duc­tion, and we have not seen that ma­te­ri­alise.

“So I think that cen­tral to the mis­sion of in­creas­ing oil pro­duc­tion in Trinidad and To­ba­go is how Her­itage Pe­tro­le­um gets its act to­geth­er in the years to come,” Ram­nar­ine said.

En­er­gy ex­pert Gre­go­ry McGuire al­so not­ed the low­er price point, stat­ing that the 2024/2025 bud­get had been tied to a high­er es­ti­mat­ed price.

“Our bud­get­ed oil price for the cur­rent fis­cal year was US $77. There­fore, the lat­est in­crease may just about cor­rect for low­er prices ear­li­er in the year, mean­ing that it is un­like­ly to have any ma­jor im­pact on the planned fis­cal deficit,” he said.

How­ev­er, McGuire ad­vised that as a na­tion T&T needs to keep its fo­cus on meet­ing the di­ver­si­fi­ca­tion chal­lenge rather than “get­ting ex­cit­ed about any and every pos­i­tive de­vel­op­ment in the en­er­gy space.”

“Let us not be side­tracked by these ran­dom ex­ter­nal shocks,” he fur­ther sug­gest­ed.

The en­er­gy ex­pert fur­ther not­ed that any flare up of hos­til­i­ties in the Mid­dle East al­ways caus­es anx­i­eties in the oil mar­kets.

There­fore, he said it was no sur­prise that there has been a short-term, glob­al spike in prices. How­ev­er, whether this would re­sult in ma­te­r­i­al ben­e­fits to T&T re­al­ly de­pends on sev­er­al fac­tors. These in­clude how long geopo­lit­i­cal ten­sions per­sist and would it es­ca­late to oth­er ar­eas par­tic­u­lar­ly the oil pro­duc­ing re­gions.


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