The government remains attentive to the evolution of the high prices of natural gas (LNG) in international markets, even doing “an exercise, in some cases from government to government,” said yesterday the Minister of Industry, Commerce and Mipymes, Víctor (Ito) Bisonó.
“Although it could have this reflection of scarcity, it is being taken into account, so that it is not reflected in an increase in any of the productive or service sectors,” the official commented.
During a meeting with the press to talk about the fuel market, the minister announced that a meeting would take place at noon yesterday, at the National Palace, to follow up on the natural gas. This supply impacts the local energy sector, as of July 2022, it represented 40% of its supply source.
less availability
Bisonó stressed that the natural gas that the Dominican Republic buys in the United States, they have already notified that they do not have the same availability, and now it is quoted with the value of Europe. He reported that, of about 3 dollars that they offered, now they put it at 57 dollars.
To compensate for the Russian gas supply cutoff, in the midst of the war with Ukraine, European countries turn to the United States, whose LNG exports to Europe almost doubled from 2021 to 2022.
Yesterday, the AFP agency reported that the German Economy Minister lamented the “astronomical” prices demanded by countries “friends” of Germany, starting with the United States, for providing them with the necessary gas to compensate for the Russian cut.
“What have people done around the world?” Bisonó asked. “Which has been changing to fuel oil, to gas oil. And what happens when that happens? Well, it’s free trade: it gets more expensive. So, we have a diesel that has not gone down, what it has done is that it has been rising in prices”.
For this week, the Dominican Government maintains the price of the cubic meter of natural gas at 28.97 pesos, and the gallon of regular diesel at 221.60 pesos and the optimum at 241.10 pesos.
In mid-September, the Dominican Association of the Electric Industry reported that it is holding talks with the authorities to “evaluate the international environment and explore possible alternatives to mitigate negative impacts on the country,” given the “convulsive situation” that the world is experiencing regarding supply. of fuels.
Defends “investment” in subsidy
Given the panorama of scarcity, Bisonó yesterday defended the millionaire extraordinary subsidy that since March 2022 the government has allocated to fuels to keep premium gasoline frozen at 293.60 pesos per gallon and regular gasoline at 274.50 pesos, and at 147.60 pesos for gasoline. Petroleum liquid gas.
He indicated that the fuel subsidy exceeds 31,000 million pesos to date. Only this week is more than 101 million pesos.
“If 100 percent of the increase in the fuel market had not been subsidized on time, inflation would have increased several percentage points, probably 12 percent per year instead of 8 percent,” said Bisonó.
For 2023, the government budgeted 20,000 million to subsidize fuels, a figure lower than what has been spent so far this year, as a forecast.
For the Deputy Minister of Internal Trade, Ramón Pérez Fermín, the fuel subsidy is an investment. And he reiterated that, although the price of a barrel of intermediate oil from Texas (WTI) -the reference in the country- has fallen, those of fuels cannot do so at par.
He attributed this to the fact that the Dominican Petroleum Refinery “in the best of cases” only processes 25-30% of imported crude oil, while the remaining 70% comes finished, with the price quoted on the international market. impacting the weekly calculations of the fuel prices.
He insisted that oil is not the most essential part when establishing the local price of fuels, since import and distribution costs are taken into account.
US President Joe Biden yesterday expressed his disappointment at OPEC+’s recent decision to reduce its output by 2 million barrels per day and considered it a “short-term” measure.
The cut by the Organization of the Petroleum Exporting Countries and its allies (OPEC+) is the largest in oil supply since May 2020 and prompts the Biden administration to consult Congress on additional measures to reduce OPEC’s control over energy prices. US President Joe Biden yesterday expressed his disappointment at OPEC+’s decision to reduce its output by 2 million barrels per day. The cut by the Organization of the Petroleum Exporting Countries and its allies is the biggest in oil supply since 2020 and has the Biden administration consulting Congress on measures to loosen OPEC’s grip on energy prices.
