(CNS): More than five years after its establishment, the Office for Utilities Regulation and Competition (OfReg) is still working on some of the main aims and objectives it was meant to address. One of the main objectives was to determine how the price at the pump of gasoline is calculated and whether it is fair, a question that is currently of great concern to the public as prices reach an all-time high of $7 and more the gallon.
Speaking at a recent open media event, Fuels executive director Duke Munroe said changes would soon be made to the legislation that will shed more light on the cost of fuel.
He said OfReg was doing its best “to get the message out” and he now had access to some of the key figures. He said he could confirm there was no collusion between the two wholesale providers but admitted that the regulator cannot yet make all the figures public and that some elements of the calculation remain opaque, even for the regulator.
Nonetheless, Munroe said he was confident that neither suppliers nor petrol station owners, many of whom are now owned by wholesalers, are scamming anyone.
OfReg does not have the power to set prices at the pump, but it can monitor prices and ensure they are in line with world prices. He said the regulator is currently monitoring fuel costs closely, given the high prices, to ensure they are no worse here than in comparable jurisdictions.
OfReg has long been criticized for dragging its feet on this broader market assessment and how prices are calculated here. However, Munroe said there were some challenges for OfReg at the start and it took time to complete the market assessment to create the basis for regulation. He said price transparency was already improving and was going to improve.
Munroe said OfReg is now focusing on creating cost transparency from the refinery to the service station and is now exploring regulatory intervention at the wholesale level. In the meantime, the regulator is looking at ways to also be more transparent about what it knows about how prices are calculated, but is currently prevented from revealing this information due to corporate sensitivity and the privacy legislation.
OfReg’s goal, he said, is to ensure a fuel market where efficient regulatory costs and market prices result in a positive economic impact on consumers and the country.
But answering the age-old question in Cayman about why prices here always rise rapidly when oil prices soar but are very slow to fall when world prices begin to fall remains elusive. Munroe explained that the proposed amendments to the law would provide OfReg with a much better understanding of how wholesalers price fuel, from when they buy it on the global market to the price at which they sell it to. gas station. He said the legislative changes would also allow OfReg to better explain the price of gas to the public.
But given the size of the Cayman Islands and the impact of world oil prices, it will always be difficult to get the most competitive prices at the pump, although recent surveys by OfReg have shown that the price at Cayman’s pump already compares well to other countries in the Region.
Retail gasoline prices are published on the OfReg website every week, enabling consumers to find the best prices. There is also a FAQ page on the website that gives consumers information on why fuel prices are rising and how prices are set in Cayman Islands.