A 21 cent per gallon decrease in the price of petrol by Esso Standard Oil on 25 August was not passed on to customers at all Grand Cayman service stations in the run up to Hurricane Gustav.
Cayman Islands Chief Petroleum Inspector Gary McTaggart confirmed the price decrease by Esso, and said that some stations passed the decrease on to customers immediately.
‘Others opted not to decrease prices at that time for various reasons, one being that some stations were not aware of the decrease by the oil company while others may not have received deliveries at the lower price and opted not to change until their stock was depleted,’ Mr. McTaggart said.
Leader of Government Business Kurt Tibbetts said Friday that petrol stations should have passed on the wholesaler’s price decrease to customers, in particular with bad weather approaching.
The drop in oil prices seen on 25 August may continue, despite the effects of Hurricane Gustav on Gulf Coast oil refineries.
Major Gulf Coast refineries halted about 15 per cent of their US refining capacity Sunday as Hurricane Gustav moved toward the Louisiana coast.
According to the Associated Press, Exxon Mobil Corp, Royal Dutch Shell, and Valero Energy Corp. were among the companies that had shut down Gulf Coast refineries. The Gulf Coast houses about half the entire oil refining capacity of the US.
Price increases recorded Monday were not significant, but analysts said the longer refineries halt production, the more pump prices are likely to increase.
However, there were signs later this week that the production delay would not last very long, with some oil companies redeploying evacuated staff on Wednesday.
On Tuesday, prices for light, sweet crude fell well below $110 a barrel and nearly made it below $105 briefly before rising again. That’s the lowest crude prices have gone in five months.
There were some petrol shortages experienced Thursday and Friday of last week on Grand Cayman, but Mr. McTaggart said those had nothing to do with available supply of gas and diesel on island.
More drivers try to top up vehicles and gas containers just before a hurricane because of fears supply may run short after the storm, Mr. McTaggart said.
‘The problem is compounded by the fact that each oil company has only one loading spot for each truck, with a loading time of about 30 to 45 minutes,’ he said. ‘They are unable to keep up with demand in an emergency.’
A Savannah gas station ran dry at the pumps as early as Thursday morning but was back on line as soon as new supply could be brought in from storage containers in George Town.
Government leaders tried to subdue fears about a petrol shortage during a storm last week.
Mr. Tibbetts said both Esso and Chevron-Texaco had a 40 day supply of gasoline on island as of late last week. Fuel reserves in Cayman Brac were estimated at 60 days.
Grand Cayman had roughly four weeks of diesel supply on hand from its major distributor prior to the storm’s arrival.