Retail fuel prices on Grand Cayman have hit their lowest point in almost six years, with a gallon of regular, unleaded self-serve gasoline costing $3.93 on average as of Tuesday.
However, the last time prices fell below $4 dollars a gallon here, recorded by the Cayman Islands Petroleum Inspectorate as February 2010, the listed price of Brent crude oil – an international benchmark price – was more than US$73 per barrel.
As of Tuesday, Brent crude prices were just more than US$32 per barrel – less than half the 2010 price.
The Petroleum Inspectorate average prices in February 2010 for retail gasoline in Cayman were $3.88 per gallon, about 5 cents lower than the average recorded Tuesday.
Similarly, diesel fuel prices on Grand Cayman were averaging around $3.92 per gallon this week. In February 2010, those per gallon prices averaged $3.68.
Brent crude prices have fallen about US$5 from US$37 per barrel in mid-January to US$32 per barrel at month’s end.
In the U.S. fuel market, that has led to a sharp drop in prices at the pump. On Tuesday, the national average for regular, unleaded fuel was just below US$1.83 per gallon. That was down about 6 cents from a week ago and about 17 cents from a month ago.
Both petrol distributors operating in Cayman’s market, Rubis and Sol Petroleum, have noted that they typically receive fuel shipments about every three to four weeks and that cargo may have loaded on the supply ship several weeks before arriving here. This delay has often been blamed for creating a lag in pricing compared to current international rates.
For the Sister Islands, that lag can be more pronounced, particularly given the relatively low volume of fuel sales in Little Cayman.
Chief Petroleum Inspector Duke Munroe has said there will always be significant differences in retail fuel prices between the Cayman and U.S. markets because of supply issues, economics of scale and other significant differences.
In addition to pump prices declining, Caribbean Utilities Company noted last week that its customers should continue to see a decline in electric bills due to the drop in diesel fuel costs. CUC uses diesel fuel to generate electricity.
CUC stated that a residential customer using 1,000 kilowatt hours per month should have seen an $85 per month reduction in their bills between December 2014 and December 2015.
In addition to the decline in diesel costs, a government reduction in stamp duty charged to CUC diesel fuel imports is expected to further drive down costs when it hits fuel bills. The duty was reduced from 50 cents per gallon to 25 cents per gallon as of this month.