One of the most im­por­tant con­se­quences of the US and Is­rael war against Iran is the sharp es­ca­la­tion in the in­ter­na­tion­al prices of crude oil as a re­sult the dan­gers as­so­ci­at­ed with at­tempt­ing to ship Mid­dle East­ern crude through the Straits of Hor­muz.

Be­fore the war, on Feb­ru­ary 27, Brent crude trad­ed at about US$73 a bar­rel and West Texas In­ter­me­di­ate (WTI) was sell­ing in the vicin­i­ty of US$67 per bar­rel. As of yes­ter­day morn­ing WTI Crude (April 1), both Brent and WTI were trad­ing at about US$100 a bar­rel.

The news agency Reuters re­port­ed on Wednes­day that sky­rock­et­ing freight rates in­crease the cost of mov­ing oil and fu­el around the world, which means that not on­ly will Paria have to pay more for the fu­el, but it will prob­a­bly have to pay to have the fu­el trans­port­ed from the Gulf Coast to Pointe-a-Pierre.

“Oil tanker avail­abil­i­ty along the US Gulf Coast has dropped sharply in ‌re­cent weeks, as Asian and Eu­ro­pean re­fin­ers cut off from Mid­dle East­ern sup­ply have been snap­ping up ves­sels to im­port oil and fu­el from the Unit­ed States, ship­ping an­a­lysts and traders said.

“The Iran war has stalled tanker move­ments through the Strait of Hor­muz, curb­ing the ​flow of Mid­dle East­ern oil to Asia and Eu­rope, and prompt­ing re­fin­ers there to buy re­place­ment bar­rels from ​the Unit­ed States, Brazil and West Africa,” ac­cord­ing to the Reuters re­port.

Con­scious of the fact that the war could have an im­pact on the avail­abil­i­ty of fu­el in T&T, I sub­mit­ted the fol­low­ing ques­tion to the Min­is­ter of En­er­gy and En­er­gy In­dus­tries, Dr Roodal Mooni­lal, on March 14, “Do you know how many months of fu­el Paria pur­chased at the pre-war price of about US$70?”

Dr Mooni­lal re­spond­ed, “I will in­quire.”

I sent the min­is­ter a fol­low-up re­quest on Mon­day March 16, “Did you in­quiries on the amount of fu­el Paria pur­chased at pre-war prices bear any fruit.”

His re­sponse was: “Let me as for an up­date of my re­quest.”

On Mon­day March 23, I wrote to Dr Mooni­lal as fol­lows:

“Can you please con­firm the fol­low­ing:

• Paria Fu­el Trad­ing Com­pa­ny main­tains stor­age ca­pac­i­ty of 2.5 mil­lion bar­rels of fu­el;

• T&T us­es about 670,000 bar­rels of fu­el month­ly;

• There­fore, Paria has stor­age for three months and three weeks.”

If my cal­cu­la­tions are cor­rect, and the Paria fu­el tank farm in Pointe-a-Pierre was full to the brim on Feb­ru­ary 28, the first day of the war, the T&T should have two months and three weeks of stored fu­el.

But in the ab­sence of in­for­ma­tion from the Min­istry of En­er­gy, on the amount of fu­el Paria pur­chased at pre-war prices and since, it is pos­si­ble that peo­ple are go­ing to start hoard­ing the com­mod­i­ty.

The oth­er bit of in­for­ma­tion that the Gov­ern­ment needs to dis­close is the ex­tent to the sub­sidy on fu­el, if oil prices re­main at or above US$100 a bar­rel.

In de­liv­er­ing the 2025 bud­get, for­mer min­is­ter of fi­nance, Colm Im­bert, said, “Over the 2020 to 2024 pe­ri­od, we have spent over $3.2 bil­lion in net sub­sidy pay­ments for 2.9 bil­lion litres of gaso­line fu­el, 1.9 bil­lion litres of diesel fu­el and 71 mil­lion litres of kerosene fu­el im­pact­ing thou­sands of li­censed gaso­line and diesel ve­hi­cles which on a dai­ly ba­sis sup­ports the trav­el­ling pub­lic and all es­sen­tial goods.

“In ad­di­tion, we have sub­sidised LPG at a cost of $380 mil­lion over the sim­i­lar com­par­a­tive pe­ri­od sup­port­ing the thou­sands of vul­ner­a­ble fam­i­lies who use cook­ing gas.”