Gas hike could 'murder' taxi business - Cab union president Leon Griffin urges Government to regulate prices

www.thenassauguardian.com By LISA ALBURY Guardian Business Reporter lisa@nasguard.com

Drivers say that failure to cap gasoline prices would be "murder of the taxi cab industry."

The industry, which is a major buyer of gasoline, spends millions of dollars with gas retailers.

Calling on Government to properly regulate prices, president of the Taxi Cab Union, Leon Griffin said something needs to done to keep gas prices level.

However, as of Saturday, the price of gasoline and diesel at the various stations throughout The Bahamas increased.

The Ministry of Trade and Industry, announced that lead free gasoline at Shell Bahamas Ltd. increased by 22 cents from $2.97 to $3.19 and diesel oil increased by 24 cents from $2.03 to $2.24.

At Esso Standard Oil, lead free gasoline, its 93 Octane, increased by 27 cents from $2.92 to $3.19, while lead free gasoline, its 91 Octane, increased by 17 cents from $2.98 to $3.15.

Texaco Bahamas Ltd. lead free gasoline, its 91 Octane, increased by 21 cents from $2.98 to $3.19 cents, while diesel oil increased by 38 cents from $2.03 to $2.41.

The price of gas and diesel in Freeport, Grand Bahama also increased. Diesel oil increased by 13 cents, from $2.32 to $2.45. And on Wednesday, March 19, lead free gasoline (93 Octane) will increase by 10 cents, from $2.90 to $3.00. Lead free gasoline (87 Octane) will increase by 16 cents, from $2.84 to $3.00

"Should price hikes continue, some drivers may just park their vehicles," Mr. Griffin told The Guardian. "Others may decide to call it quits altogether."

According to the standard flat rate regulated by the Road Traffic Department, the fare for passengers travelling from Paradise Island to the Airport is $28 for two passengers and $3 extra for each additional passenger. There is also leeway for cab drivers to charge passengers for luggage.

Charges for meter fares start at $3 with $0.40 charged for every quarter mile travelled. No matter whether passengers travel at the flat rate or meter rate, drivers are permitted to charge any price agreed upon with passengers.

Mr. Griffin said he is not certain whether the price of gasoline is reflected in the amount of money charged to passengers because the rates or fares are controlled by the Road Traffic Department.

While he believes oil companies are not to blame, because gasoline is not made in the country, the president said their profit margin is contracting, mainly due to high taxes Government charged to bring the product into the country.

"I believe that if the Government was to go down on the taxes they charge oil companies and suppliers it would help," he said. "Then these savings could be passed on to the consumers who are the ones really being affected by the high prices."

The Bahamas Electricity Corporation is blaming higher fuel costs for an increased surcharge in consumer billing.

It is estimated the cost of a gallon of gas plus delivery to The Bahamas is about $1.15. Oil companies or gas suppliers reportedly make $0.40 per gallon; gas stations about $0.50 per gallon, bringing the total supplier and retailer margin to approximately $0.90 per gallon.

Some say gasoline mark-up far exceeds the average of other countries, and should be controlled by aggressive price competition or some type of regulation by the Ministry of Trade and Industry.

Just as taxi drivers now have to be cautious in their spending of gasoline to continue their business, other Bahamians are being urged to be prudent in spending.

With the United States preparing to go to war with oil-rich Iraq, the cost of living in The Bahamas is expected to surge over the next six months.

A main component in the possible price increase of gasoline is an unexpectedly long oil strike in Venezuela, which normally accounts for about 14 per cent of U.S. imports.

During the latter part of 2002, the U.S. Energy Department said it would lend crude from the national Strategic Petroleum Reserve to U.S. oil companies whose refineries were suffering a shortage of supplies from Venezuela.

The OPEC nation exported almost 2.7 million barrels per day and supplied around 14 per cent of U.S. daily oil imports before the strike.

Iraq sits on the world's second-largest oil reserves, at least 112 billion barrels worth.

Caption:TAXI BUSINESS - Taxis, left, line up at the British Colonial Hilton for fares, as the Government announces hikes in gas prices over the weekend. (Staff photo by Patrick Hanna)

Posted Monday March, 2003