OfReg offers little hope on gas prices

| 30/04/2020 | 82 Comments
Cayman News Service

(CNS): Gas prices finally started to fall in Cayman this week but the utilities regulator, OfReg, which is tasked with tracking fuel costs around the world as well as regulating the sector here, has backed the local fuel suppliers’ claim that the lag in price decline is unavoidable. For years there have been concerns that while it takes weeks for a change in pump prices when the price of oil drops, it seems to increase in days when world prices go up.

“On average, fuel takes about four to six weeks to reach the Cayman Islands after purchase from the various sources, including from the Gulf and East Coast of the United States,” the regulator stated in a release. “As such, consumers in the Cayman Islands can expect to see reductions at the pump delayed by a similar period when prices are observed to be declining.”

Offering little hope to drivers, who have now had to wait more than eight weeks to see any significant change in the price at the pump, OfReg said the gas that people were buying last weekend here was typically purchased and loaded on the vessel around mid-March.

On Monday, 20 April, the price of a barrel of oil turned negative for the first time in history after the deepest fall in demand in 25 years. A flood of unwanted oil in the market meant suppliers were literally paying people to take it away as they had nowhere to put it.

Yet on Grand Cayman people are still paying around $4 a gallon on average. The lowest local gas price on 20 April here was the ethanol mix offered by Refuel at $2.99 per gallon The lowest per-gallon price for regular is $3.87 and for premium, $4.43. On the Sister Islands drivers are still paying as much as $6 per gallon.

OfReg claimed that its focus was on ensuring that the reduction in prices for importers gets reflected at the pump. Officials said that they will be assessing the purchase price and comparing it with the sale price when the next shipment arrives in the Cayman Islands. The office said it tracks and assesses the ‘first cost’ as well as the CIF (cost, insurance, freight), trading differential, landed cost of product, wholesale price and retail price.

“The price of gasoline will always be driven by the economics of demand and supply globally,” OfReg stated. “While prices in the Cayman Islands are based primarily on acquisition and other generally fixed cost per unit gallon, changes in prices at the pump are heavily influenced by the time it takes to finish a batch of fuel and move on to a new either lower or higher cost batch of fuel.”

The reduction in demand for fuel will also impact the fall in prices, the regulator warned, as it said fuel in bulk tanks and at the gas stations will take a longer time to sell out, which is why consumers may have to wait even longer for any really significant drop in prices.

The regulator also claimed that the logistics of importing also impact the time it takes for prices to change, as oil tankers deliver to a number of other ports before arriving into Cayman.

“This time can vary as the entities have the option to divert ships to countries most in need of supplies,” OfReg added.

So far this year, the cost of gasoline and diesel imported has fallen by 90¢, on average, for gasoline and diesel product, while propane fell by just 20¢ on average. OfReg’s analysis shows that a further reduction in wholesale prices is expected within the next week. But changes in price at the pump will still be impacted by the stocks at the gas stations.

The public can direct questions to the regulator by calling at 946-4282 or emailing info@ofreg.ky.


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Category: Business, Politics, Private Sector Oversight, Retail

Comments (82)

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  1. Anonymous says:

    Has anyone looked at the OfReg website? I just looked to see who is running this farce. The bio of very director and manager just says “comming soon”. No bio, just two words, and they misspelled one of them. That tells you everything you need to know about the intellectual prowess and hard work going on behind OfReg’s doors.

  2. Anonymous says:

    I was wondering if the government is negotiating with CUC to reduce rates and not just the two or three month pardon?

  3. Anonymous says:

    Let’s be perfectly honest here.
    We are ruled by a criminal cabal. No different to most places in the world.

  4. Anonymous says:

    Sounds like the typical situation where the gas stations and the regulators are making the money (with lots of free travel and perks and maybe some side money) and the public is still paying for it all. Incredible job CIG. I wish I could work for you.

  5. Anonymous says:

    Actually I don’t feel sorry for the local consumers having to pay high gas prices…a few years ago Mr. Ebanks (Tukie), did his research on fuel prices and organized a protest to the government…on the day of the protest, not one person showed their support. After all of the hard work and time that he spent, he did not have the support of the people. We should have to pay $8.00 per gallon. A Caymanian.

  6. Anonymous says:

    If OfReg required “net metering” from CUC and broke up that “15% return guaranteed, gold plated” electricity monopoly, then more people could and would use solar for home and for electric cars etc.

    It’s an absolute joke and travesty that electric cars and solar for homes are not common place on these islands given our climate. It would, in effect, be free transportation for all, (and not a government “GASBOY” rip off scam, in sight (what ever happened to that Auditor General’s Report and findings…..hmmmm?).

    Wide spread use of electric cars and “net metering” for homes would surely take the “gas” out of these islands’ petroleum and diesel cartel, as well!

    • Anonymous says:

      There is no guaranteed return to CUC. Has not been for many years.
      Please explain net metering to everyone. So they understand that it means that production price = retail price. With no margin for transmission, etc.
      Is that how the sale of other items work?

      • Anonymous says:

        Well it lasted way, way longer than it should have and they milked us for all it was worth (and more).

        Don’t forget, we, the consumers, paid to rebuild CUC’s distribution system after Ivan – the “surcharge”, when of course CUC should be required to fund for this inevitability or go to the alternative insurance market – we live in the middle of hurricane alley, for God’s sake. However, that would reduce the dividend payments.

        The oft reported cosy relationship between certain politicians who are shareholders in CUC and the oversight of the utility, is a blatant conflict of interest, 25 years deals are the fantasy of authoritarian regimes…….

        How many places on earth PROHIBIT Net Metering? Err,,,,,not very many, but of course, Cayman is one of those few.

  7. Anonymous says:

    All gas stations have a lag between buying and selling. It does not take 4 to 6 weeks to ship anything from the US, much less gas. You can buy tank container loads in Miami and have them here in 2 days (ok not with Covid). Gasoline is $1.49 and dropping where I live. What you have is a local cartel.

    • Anonymous says:

      Give offreg to the same people who runs the private sector Pensions fund. They know exactly how to lower prices.
      Lets also pray for Anon.

    • Anonymous says:

      Agreed 100 %, is a crying shame why gasoline prices is so high here and nothing is done about it.

  8. ThIs WrItInG Is VeRy IrRiTaTiNg says:

    Have the folks at OffReg asked the fuel importers if they use any oil futures to smooth out the price fluctuations? If they are then this should be factored into the prices as well. They can’t keep all of that for themselves and soak the consumers for whatever the price is on the last tanker to arrive.

  9. Anonymous says:

    If it takes 6 weeks for price reductions to lag or be seen, why does it only take 6 hours for increases to hit the pumps??? Please OffReg, explain to the dummies…

    • Anonymous says:

      If there are increases within 6 hours, report it to OfReg immediately…

      • Anonymous says:

        lol..report it to Of.Reg..fat chance they will do anything..

        • Anonymous says:

          Exactly, they’re always driving around in the car so they’re never getting emails.

          • Anonymous says:

            They don’t drive around in cars. They drive around in big ass suburban SUVs. A car would be demeaning and beneath their status.

      • Anonymous says:

        A report with OfReg! Good one. I am sure they will read that and take action immediately…..not.

        OfReg’s brief is “make it look like you’re doing something from time to time but under no circumstances are you to ever actually do anything at all to upset the status quo, just cash the cheques, enjoy the perks and keep your nose out of our business”.

  10. OfReg's Erectile disfunction says:

    There is hope CNS, hope that the price of oil rises so these pirates can continue to fleece us here in Cayman and Do Not be surprised if they add a Covid-19 surcharge to make up the shortfall they have suffered recently. OfReg’s impotency is a national disgrace and shameful as is it’s woefully inadequate leadership.

  11. Anonymous says:

    These guys at the regulators dept are a WASTE OF GOVT $!!!!

    • Anonymous says:

      PLEASE- this drives me mad…. these are NOT Government’s dollars – they are OUR dollars, the people’s dollars …. generated by import duties, fees that, we the people resident on these islands pay and, most importantly, (especially in these times of local lockdown) from international financial services companies/structures.

      Saying it’s the “Government’s dollars” is a cop out you are allowing to CIG…. as of it’s not ours really so when the blow it, it’s not ours that they are blowing…. but it is our, the people’s money that they fritter away through waste, inefficiency, ineptitude and worse…

      CIG should never be allowed to think otherwise than they have the privilege to use our, the people’s, money. Not the right.

  12. Anonymous says:

    Ladies and gentlemen this is the time to regulate these people once and for all. Push the Government members to regulate by law. Not just elect., fuel, food, insurance companies but everything in health, dental and eyecare, etc. Its time. If they can’t do it go to larger companies in USA, Europe, Canada, etc.

    • Anonymous says:

      Who are the owners of the petrol stations on Grand Cayman? By knowing this fact it will help explain why the windfall profits continue for these owners.

      • Don't you says:

        have to be a politician to own a gas station?

        • Anonymous says:

          If politicians or people with very close family ties to politicians who own gas stations, it will explain why there has never been action on high gas prices.

          Are politicians in Cayman required to give business self disclosure forms?

          • Anonymous says:

            Good question. The answer is yes, they are required to disclose their interests in a publicly accessible register but they don’t. There is apparently a dusty ledger somewhere in the LA offices that Caymanians can view by appointment during strictly limited hours and there is almost nothing disclosed in it.

            The standards in public life law was going to change that, which is why it didn’t get passed for 10 years and then was watered down to the point of being useless. MLAs can’t be expected to survive on a few hundred thousand a year plus a lavish pension, a car and driver, and a free credit card for all their expenses can they?

  13. Anonymous says:

    Like the National Pensions Scheme, another entity for which our distinguished (in his opinion) Premier is constitutionally responsible.
    If only he had put a quarter of the effort into each of these as he put into trying to destroy George Town harbour with Moses and McKeeva’s cruise monstrosity.

  14. Anonymous says:

    I’m not sure what all the moaning and groaning is about. Ever since they opened I only fill up at ReFuel, which is now less than $3.00 per gallon. Yet, ever since they opened I also see the majority of drivers still filling up at the other stations and paying $0.30 to $0.40 per gallon more. Also, note that in recent months ReFuel has been over $1.00 cheaper per gallon than any other station! The prices at the other stations will never come down as long as drivers are willing to pay the higher prices. I realise that there are reasons of convenience, etc., why drivers have to use the other stations, but please realise that there is an alternative, with much lower prices. It’s your choice.

    • Anonymous says:

      I would love to use refuel but whenever I do my car seems to have issues accelerating.

      • Anonymous says:

        It’s bad gas. I drive a performance car and I’m quite sure that gas would ruin my engine.

        • Anonymous says:

          I bought a brand new car last year September and have been using Refuel ever since..Absolutely nothing wrong with their fuel or my car..I think that is all hearsay about the fuel causing issues if that was the case lots of people would be complaining and not going there..just wish that had a station a little closer to where I live but worth the drive to save the big bucks.

        • Anonymous says:

          Do do I and it’s fine.

        • Tom says:

          I have use Refuel since they first open and never have any problems….

      • Anonymous says:

        Never had a problem with my Toyota and KIA with Refuel after 2 years.

    • Anonymous says:

      there are some vehicles that cannot use ethanol fuel.

      • Anonymous says:

        Their fuel is classified as regular gasoline in the US, every station sells it, it’s not to be confused with Flex fuel, or high ethanol fuels, which you are completely right about and shouldn’t be used in everyones vehicle.

    • ThIs WrItInG Is VeRy IrRiTaTiNg says:

      I tried a few tanks of the gas from Refuel and the the lower price was almost exactly offset by reduced mileage per tank in my vehicle. Cheaper is not always better. In this case it is pretty much the same amount of money spent but more stops to refuel each month so the hassle wasn’t worth it.

      • Anonymous says:

        Agreed, it’s garbage gas.

        • Anonymous says:

          I tested my car with 3 different gas stations as one Always made my car difficult to start. I then thought maybe it’s the dirty tank so I tried again with a brand new gas station and the same issue. No issue whatsoever with Refuel and Esso. None

      • Anonymous says:

        I seriously doubt that you’ve done any verifiable tracking of your mileage to confirm how ReFuel stacks up against the other brands. In a consumer notice, the Federal Trade Commission, notes: “In most cases, using a higher-octane gasoline than your owner’s manual recommends offers absolutely no benefit. It won’t make your car perform better, go faster, get better mileage or run cleaner.” In most cases, 87 octane fuel, also known as regular, is recommend by most manufacturers. However, various hi-performance and luxury vehicles may require higher octane grades.

  15. Cayman Dominoes Mafia says:

    Absolutely close Down this rubbish that Kurt set up to employ his domino gang partners minions who have now form and unholy alliance with the OfReg boss and chief fuel inspector coming from the same jurisdiction. Who are not going do nothing against the two main fuel providers their cash cows look around at the local distributors and see their affiliation to which political party and understand this in the context of why we cannot get a break at the pump.Even the board of this Useless behemoth authority is filled with political dinosaurs and party supporters.All hail the grand wizard Kurt D the explanning minister now “ building consultant”that get plans through the many hoops and scoops at planning Department . And who da cap fit let dem wear it We tired of of this political $#@% ppm run by the same old corrupt players and party cohorts. Anyone doubts what I am writing here Ask the premier to please furnish the names of all the Covid-19 recovery committee!

  16. Anonymous says:

    Off Reg ensuring poor Cable TV, outrageous gas prices by telling you they are working on it trust Massa and Uncle Tom..Next I expect they would be telling me to pray and things would get better and of course if I die in the right church I will go to heaven where i can fly. A recipe for slavery..

  17. Anonymous says:

    A useless department that hires people that serve no purpose. When Kurt created this entity, his speech was one of grandiose and thunder. This department was going to be the savior to all fuel injustices.

    But, as usual, he speeches far outperformed his delivery.

  18. Anonymous says:

    This “black hole” aka OfReg was created by Kurt Tibbetts when he was a Minister. When he returns to office once more, he will create OfReg2 which will regulate OfReg1!!!

  19. Old Byes Mafia says:

    Remove leadership from OfReg and Fuel provider price go down! right Away send a very strong message to our Caribbean fuel pirates.

  20. Anonymous says:

    OfReg and Pensions. Same scam.

  21. Anonymous says:

    OffReg “they need to price gouge so they can keep their profits up on the back of a crushed economy. And that is okay with us” thanks OffReg, so glad you are a thing.

  22. Anonymous says:

    Where the hell you going? Haven’t filled up any of our vehicles for six weeks.

    • Anonymous says:

      Some people are essential staff and need to be on the road as they normally would. Think of someone other than yourself next time.

      • Anonymous says:

        Essential my ass. Sacrificial you mean.

        • Anonymous says:

          I would class hospital staff, police & firemen as essential. And the bank staff and grocery store workers. None of them has died here so how are they sacrificial?

          • Anonymous says:

            Hospital has less patients in it than it would under normal circumstances, police spraying peoples hands at the supermarket, firemen playing domino’s, supermarket workers living in bubbles. My point stands.

            • Anonymous says:

              While I agree that the hospital has barely any people in it it doesn’t matter because they still are putting their life on the line working at a hospital right now. Whether or not we have that many cases here is irrelevant.

          • Anonymous says:

            Expendable test subjects then.

  23. Anonymous says:

    OfReg is a waste of a lot of public dollar$$!! Really!!

  24. Anonymous says:

    Why don’t they make them sell it at the current price + margin? They’ll make a bit less when the price drops below what they paid, and make a bit more when it goes above what they paid.

    • Anonymous says:

      They can’t even get them to publish their ‘purchase price’ + margin. i.e. wholesale price.

      OffReg needs to start publishing that Excel sheet they have showing purchase date & price, delivery date & price, wholesale date & price. Then we’ll know if there is any misaccounting or not.

  25. Anonymous says:

    Cayman fuel prices rape the consumer.

    They are a significant drag on our economy.

    Time to reset this sh..!

    • Anonymous says:

      Will not happen. No political will as gas stations are just another part of the gravy train our politicians and their families are on. A gravy train that never stops.

  26. Anonymous says:

    The present gas prices should be a boost for electric cars on the island … but as usual in Cayman , few people even consider solar power … which definitely is a big plus to power pool pumps allowing much lower chemical use to keep it clear and clean at the very least. If you put your head to it solar power makes a LOT of sense on this island. You can go solar + batteries

    • Anonymous says:

      So you have a spare $15k laying around plus another $5k for installation. What with the cost of insuring your system year after year it might take 10 years to pay it back. Batteries might need replacing after 5 years.
      CUC still doesn’t allow net metering so the electric mafia aided by OfReg keeps the status quo.
      Solar here is not for the masses and won’t be for decades to come, and most definitely in a climate of increasing austerity we’re now in.

      • Anonymous says:

        I priced solar a couple of years ago got my small new build condo. I could not recoup the cost vs my monthly bills before the warranty ran out / 5 year battery life. I want to be green but I couldn’t afford that.

    • Anonymous says:

      Net metering is the issue.

      Until CUC is forced to take net metering on board, only those with $25k spare and an environmental conscious, will ever use solar power in their homes….or hobbyists.

      Who in their right mind would buy electric cars, busses tucks in the “current” situation?

      I’ll never forget the time as I was driving to work and listening to the radio talk show when the “Honourable” member for EE said that “solar will never work for public lightening as it is needed at night”….I nearly crashed my gas guzzler into the side of the road.

      With “leadership” like that, no wonder we are living in the “dark” ages!

      Net metering should be forced onto CUC and the monopoly of electricilty generation and distribution shattered.

      Remember $500 a month phone bills for households, when it was just C&W?

  27. Anonymous says:

    I understand, they need more high priced SUV’s to drive around in before they can come up with a solution. Funny how I always see them parked at Cost u Less in the middle of the afternoon, must be checking on mango pricing.

  28. Anon says:

    OfReg offers little hope on anything, except lavish salaries and expenses for their myriad managers.

  29. Anonymous says:

    I bet if we enforced a “four to six week lag” on the outrageous salaries these OfReg people are getting, that we would see some action.

  30. Anonymous says:

    OfReg has been impotence and useless for a long time. It is time to do away with that top heavy dinosaur and start again with leadership and management that have a focus on delivering value to the consumer.

  31. Anonymous says:

    should read OfReg offers little hope.
    Office in disarray due to travel restrictions.

  32. Anonymous says:

    Ofreg is a joke. Now is the right time to close this useless authority down.

    • Anonymous says:

      I agree. Close it & use the millions saved to feed the school kids (government schools asking for donations. WTF) & the unemployed (again private donations feeding 100’s every day).

  33. Anonymous says:

    Close OfReg down!

    • Anonymous says:

      Dont see ICTA achieving much either

    • Anonymous says:

      They still havent said why the lag is only when the price goes down or why we pay over $2 per gallon more than they do in the states and it is not because of imperial gallons because our dollar is worth 20% more than the us dollar

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