BY ANNELIA NIXON

TRIBUNE BUSINESS REPORTER

anixon@tribunemedia.net

BAHAMIANS are unlikely to see significant relief at the pumps in the immediate future, with gasoline prices continuing to climb and some service stations now selling fuel for more than $7 a gallon.

Roker’s Gas Station owner Peter Roker said the elevated prices could become a longer-term reality for motorists, arguing that global market pressures and ongoing conflicts are likely to keep fuel prices above the levels Bahamians were accustomed to paying.

“I believe in the final analysis, gasoline is going to end up being maybe overall $1 more than we were used to before, or 50 cents more,” Mr Roker said. “But don’t forget, five cents more when you’re selling billions of billions of gallons is a lot.”

Gasoline and diesel prices on Tuesday were reported to be in the mid-to-high $6 range, with some retailers pushing beyond the $7 mark.

Mr Roker said the price of gasoline before the recent increases was roughly $4 to $5 per gallon, although he noted that prices were once significantly lower.

“I think it was four something to $5,” he said. “But still, that’s a lot of money. That’s almost $2 on every gallon you buy. Whereas it wasn’t that long ago, gasoline itself was only $1.50 a gallon.”

He said the impact of higher prices is particularly significant because fuel is purchased frequently by consumers and businesses.

“Gasoline is a volume item,” he said. “It’s not like buying a big refrigerator or a big TV. People buy gasoline every day. So it’s incrementally expensive. It’s like interest rates.”

Bernard “Porky” Dorsett, operator of Porky’s Rubis Service Station, said the latest increases have already pushed some brands above the $7 mark.

“Well, today Esso just gone over $7,” Mr Dorsett said. “The price still going up. Shell just gone up. Rubis been up for the last month. I couldn’t take care of my people. I was 30 cents higher than everybody else.”

He said he does not expect prices to begin falling in the immediate future.

“I don’t think they’re coming down right now,” Mr Dorsett said. “I don’t see it.”

However, he suggested that any decline in wholesale prices could prompt retailers to reduce pump prices in an effort to stimulate sales.

“Now that the price drop I can take 25 cents off my gas probably this weekend and try to pump some volume before by the end of the month,” he said.

Mr Dorsett said he hoped current fuel prices would not become the new normal for Bahamian consumers. Both retailers pointed to international supply-and-demand pressures and geopolitical conflicts as major factors that continue to influence fuel prices.

Mr Dorsett said disruptions to fuel infrastructure and ongoing fighting between Russia and Ukraine continue to create uncertainty in global energy markets.

“It’s all about supply and demand,” Mr Dorsett said. “But we got wars going on all over the place. So, it ain’t getting no better. It’s just a tit for tat and the rest of the world suffers.”

Mr Roker similarly argued that ongoing conflict is creating continued instability in the oil market, saying prices are unlikely to fall substantially while disruptions and hostilities persist.

“As long as that wall exists, it’s causing a glitch in the system,” Mr Roker said. “So as long as the blockade is there, and they’re shooting at each other, it isn’t going to go down.”

He does not expect the current conflicts to end in the near term.

“I don’t see the conflict ending very, very soon,” Mr Roker said. “I don’t see it intensifying. What I see happening right now, unless I’m wrong, is that the conflict is kept at an acceptable level on both sides.”

Mr Dorsett said the volatility of global oil prices means even a temporary decline can quickly be reversed by geopolitical developments.

“One day it drops to $90,” he said. “Somebody fire a shot and they go back to $120. So we’re in problems.”

Mr Roker said he believes consumers may eventually see some moderation in fuel prices, but he does not expect a return to the lower prices of previous years.

“I think the gas will go down somewhat,” he said, warning that once consumers demonstrate they are willing to absorb higher prices, there may be little incentive for prices to return to previous levels.

“This has become an economic football for people to make money from essentially at the taxpayers’ expense,” Mr Roker said. “And being allowed to get away with that I think they will do that.”

He also questioned the continued duration of the international conflict driving much of the current uncertainty, describing the situation as unnecessarily prolonged.

“This war now is a big joke,” he said. “It looks like a couple of school children throwing snowballs at each other. And there’s no need for it.”

For Bahamian motorists and businesses, however, the consequences are far from trivial as every increase in pump prices adds to transportation and operating costs and puts additional pressure on household budgets. Mr Roker said even seemingly small increases have a significant cumulative effect because of the volume of fuel sold globally.

“Five cents more when you’re selling billions of billions of gallons is a lot,” he said.