The Utility Regulation and Competition Office announced that the Cayman public will enjoy lower fuel prices at the pump for the festive season, and into the new year.  

CAYMAN ISLANDS, 12 December 2018

OfReg, the multi-sector regulator of the Cayman Islands, has today announced that residents will see a reduction in the price of gasoline and diesel, in response to the global decline in oil prices.  

As part of its remit, OfReg is responsible for regulating the Fuel Sector and ensuring that prices at the pump are fair, while ensuring the suppliers/investors in the sector generate a reasonable return on their investment. Intervention by OfReg in recent times has improved competition among Fuel Sector licensees, resulting in price differentials by as much as $0.52 per gallon for the same grade of fuel across different brands of gas station in Grand Cayman. 

OfReg’s Fuels Analysts have observed a moderate decline in local prices in November 2018, however the sharp decline in global prices over the past few weeks necessitated a more significant decrease in price, which has already gone into effect at some retail gas stations. At the beginning of December 2018, the average gasoline price was $4.76 per gallon.  During the recent price review, price for regular gasoline has been further reduced down to $4.14 per gallon at one retail outlet.

In October 2018, global oil prices peaked at $86 per Barrel (Bbl), the highest it has climbed since the global decline which saw prices down to $30 per Bbl in early 2016. Oil prices have not reached $100 per Bbl since mid 2014. Refined fuel prices have declined on average $0.50 per gallon since November 2018, so taking into account the 4 – 6 week lag for bulk fuel products to arrive in Cayman via fuel tankers (ships), an average of $0.30 per gallon reduction should begin to be in effect at the pump. 

OfReg’s Fuels Market Director and Acting CEO, Duke Munroe, commented:  

“Our priority is to ensure equitable fuel prices to the Cayman public in keeping with our mandate, and in support of Government’s broad outcomes. While the market assessment will be instructive to our policy recommendations to government, our current efforts are aimed at ensuring prices in the market are not collusive; reflect movement in acquisition costs by the various players; and are responsive to global trends.” 

As part of the Regulator’s ongoing efforts to monitor and supervise the Fuel Sector, it recently issued an RFP to conduct a comprehensive study to define the relevant markets within the fuel sector, and assesses the extent and effectiveness of competition within these markets. Once completed, OfReg will further enhance its regulatory framework for greater effectiveness in its regulation of the sectors. The work is estimated to commence in the first quarter of 2019.  

OfReg monitors and posts weekly retail prices on its website atwww.Ofreg.ky