Energy Ministry says rising oil prices more curse than blessing

Oil priceBelize stands to collect more via the Windfall Tax from the rising global price of oil. However, the Ministry of Energy, Science & Technology, and Public Utilities says that the cost will out-weigh the benefits.

Dr. Colin Young, Ministry of Energy’s CEO, explained Tuesday that the influx of revenue Belize will receive will be significantly less than the country’s expenditure in buying fuel.

Young said that the rise in fuel will always negatively impact Belize and is a clear indicator that the country needs to wean itself off dependency on diesel fuels and start looking into more renewable energy endeavours.

Following the bio-chemical weapon attack in Syria in late August, the price of oil on the world market rose to over US$111 per barrel. After the United States announced that it may make a military strike against Syria, Brent crude oil peaked at US$117 a barrel.

Foreign media, such as the International Business  Times, project that prices will increase in the coming months.

In September 2008, GOB imposed the Windfall Tax on Belize Natural Energy Limited, the only oil company to ever strike oil in Belize.

This tax allowed for GOB to collect 50 percent of the profits for every barrel of oil sold above US$90 per barrel.

The threshold of $90 a barrel has been criticized by NGOs and third parties alike.

In 2010 Citizens Organized for Liberty through Action (COLA) argued that GOB should lower the threshold, this point was also raised by the Vision Inspired by the People (VIP) last year.

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