Gas Accessibility In Belize: A Tourist's Guide To Filling Up

Gas is readily available in Belize, but it is expensive. Belize is a net importer of fuel products, with gasoline being the most common. As an imported commodity, Belize is subject to international prices and acquisition costs. The price of gas in Belize has been steadily increasing, with prices reaching a record high in 2022. In March 2022, the regulated pump price of regular gasoline was $13.50, a 66-cent increase from the previous shipment. In June 2022, premium gas was being sold at $16.03 a gallon in Punta Gorda, Toledo, the first time a gallon of fuel had reached $16 in Belize. The high cost of fuel has a significant impact on the economy and the cost of living in Belize.

Gas prices in Belize are influenced by international LPG prices

The landed cost of LPG imported into Belize forms the basis of the gas prices consumers pay. This includes international acquisition costs, transport and handling costs, port throughput costs, and applicable government duties, taxes, and fees. On top of these costs, the National Gas Company (NGC) of Belize incurs additional expenses for receiving, storing, blending, distributing, and selling LPG at an import wholesale price. This wholesale price is uniform across the country, regardless of the size of the operator.

The wholesale and retail margin beyond the NGC import wholesale price is regulated by the Controller of Supplies. The prices established for imported LPG are based on specific mixtures of propane and butane, as per the Belize National Standard Specification for LPG. The Supplies Control Unit (SCU) in the Ministry of Investment, Trade and Commerce plays a role in introducing fixed controlled prices for the sale of LPG, reflecting both wholesale and retail sales in urban and rural areas.

To secure competitive pricing and maintain quality, the National Gas Company conducts an annual open bid process, inviting both local and international LPG entities to participate. This process ensures that Belize obtains LPG at the best available rates, mitigating the impact of fluctuations in international LPG prices.

In summary, while international LPG prices significantly influence gas prices in Belize, the National Gas Company and the Belizean government implement measures such as controlled pricing and open bidding to manage the impact on consumers and ensure a stable supply of LPG in the country.

The National Gas Company carries out an open bid process to secure the best LPG pricing

Belize is a net importer of fuel products, with gasoline being the most prominent. As a result, the country is subject to international prices and associated acquisition costs. The National Gas Company (NGC) of Belize is responsible for securing LPG supplies for the country. To ensure competitive pricing and the best quality, NGC conducts an annual open bid process, inviting both local and foreign LPG entities to participate. This process is publicly advertised, and the successful bidder is chosen based on the criteria outlined in the tender document.

The LPG prices that Belizean consumers pay are influenced by three main factors. Firstly, the landed cost of LPG, which includes international acquisition costs, transport and handling fees, port charges, and applicable taxes and duties. Secondly, the costs incurred by NGC for receiving, storing, blending, distributing, and selling LPG at a uniform wholesale price nationwide. Lastly, the wholesale and retail margin beyond the NGC import wholesale price, which is regulated by the Controller of Supplies.

The wholesale import LPG price offered by NGC to bulk clients is determined by several factors. These include acquisition costs from international markets, freight and handling charges, port throughput costs, financing costs for infrastructure development, regulatory fees, operation and maintenance expenses, and transportation costs for delivering LPG at a uniform price across Belize.

The LPG industry in Belize is partially privatized, with subsidiaries of regional giants like Grupo Tomza, Tropigas, and Zeta controlling 57% of the wholesale and retail markets downstream of NGC. Competing Belizean companies hold 43% of the market, with small operators purchasing LPG from NGC's terminal and depots at the same price as larger operators. This competitive landscape ensures that LPG prices in Belize are driven by market forces and fluctuate with international LPG prices.

By conducting an open bid process, NGC promotes transparency and competition in the LPG market. This process allows for the participation of various industry players, both local and international, and helps NGC secure the best pricing and quality for LPG supplies in Belize.

The Government of Belize is establishing a Fuel Stabilisation Mechanism

Belize is a net importer of fuel products, with gasoline being the most prominent. As a result, the country is vulnerable to fluctuations in international fuel prices, which can have a significant impact on the Belizean economy. The recent surge in fuel prices, caused by the Russia-Ukraine war, has led to record-high fuel prices in Belize, with premium gas reaching $16.03 per gallon in some areas.

In response to the rising fuel prices, the Government of Belize (GOB) is taking several measures to mitigate the impact on its citizens and the economy. One of the key initiatives is the establishment of a Fuel Stabilisation Mechanism, which aims to provide price predictability and protect fiscal targets in the national budget. This mechanism is expected to help stabilise fuel prices and reduce their impact on inflation and economic growth.

The GOB has also been actively engaged with various stakeholders, including Belize's principal fuel importer, Puma Belize Ltd, to explore burden-sharing initiatives that can contribute to price stabilisation and reduction. Additionally, the government has reduced taxes and levies on fuel products, such as diesel, to keep prices affordable for consumers. For example, the tax component on diesel fuel was reduced by $1.17, resulting in an annual loss of $17 million in anticipated budget revenues.

Furthermore, Belize has a diverse market for fuel products, with regional giants Grupo Tomza, Tropigas, and Zeta controlling 57% of the wholesale and retail markets. Competing Belizean companies hold 43% of the market, with small operators purchasing fuel from the National Gas Company (NGC) terminals at the same price as larger operators. This competitive market structure helps to ensure a stable supply of fuel products in the country.

The GOB's efforts to address the fuel price surge demonstrate its commitment to balancing affordable pump prices with budgetary steadiness. By establishing the Fuel Stabilisation Mechanism and collaborating with stakeholders, the government aims to protect its citizens and the economy from the negative consequences of rising fuel prices. These measures are crucial in mitigating the impact of global fuel price volatility on Belize and its people.

The rising cost of fuel impacts the cost of other products, including food

Belize is a net importer of fuel products, with gasoline being the most prominent. As a result, the country is susceptible to fluctuations in international fuel prices, which can have a significant impact on the Belizean economy. The rising cost of fuel impacts the cost of other products, including food, as it is a significant input cost for firms. This is particularly true for products that are manufactured overseas or contain plastics and synthetic materials derived from petroleum.

The impact of rising fuel costs is felt across various industries, including manufacturing and distribution. Companies are faced with difficult choices: operating at a loss, charging higher prices to customers, or finding innovative ways to reduce expenses. The cost of shipping and transportation increases significantly with rising fuel prices, affecting both local and international trade. This is evident in the trucking industry, which accounts for the majority of freight in the US, where companies apply fuel surcharges to maintain profitability. Similarly, ocean shipping costs are rising due to fuel prices, and carriers are responding with surcharges and "slow steaming" to reduce fuel consumption.

The aviation industry is also affected, with jet fuel prices impacting the bottom line of airlines. As fuel expenses constitute a large portion of their overhead, airlines are forced to increase ticket prices, which can discourage non-essential travel and further impact the economy. Additionally, rising fuel costs can influence hiring practices, as businesses may reconsider their expansion plans due to economic uncertainty and reduced sales caused by lower discretionary spending.

The impact of rising fuel costs on the cost of living is also significant. Consumers have to spend a larger portion of their income on gasoline, leaving less for other goods and services. This reduction in discretionary spending can have knock-on effects on various sectors, including retail and entertainment. However, the rise of online shopping during this period provides some relief to retailers, as consumers opt for online purchases instead of driving to physical stores.

The energy sector in Belize is heavily influenced by international LPG prices, which are subject to fluctuations due to seasonal demand and market factors. The National Gas Company (NGC) of Belize plays a crucial role in securing LPG supplies for the country, conducting open bid processes to ensure the best quality and pricing. The cost of LPG in Belize is determined by factors such as international acquisition costs, transport and handling, port throughput, and applicable taxes and duties.

The rising cost of fuel has both direct and indirect effects on the economy. It impacts consumer spending, transportation costs, and the price of goods and services. The interconnection between fuel prices and economic growth presents a challenging situation for Belize, requiring careful consideration of fiscal policies and strategies to mitigate the negative consequences.

Belize is a net importer of fuel products

The impact of fuel prices on Belize's economy is significant. High energy costs can hinder economic growth, and oil price shocks can have a detrimental effect on the country's economic prospects. The recent International Monetary Fund (IMF) statement highlights the risks associated with high energy prices, particularly in net-oil-importing countries like Belize. The challenge for Belize is to find a balance between managing these risks and maintaining fiscal discipline, especially with its high debt-to-GDP ratio and budget deficit.

The National Gas Company (NGC) of Belize plays a crucial role in the country's fuel market. It offers a wholesale import LPG price to bulk clients nationwide, which includes acquisition costs from international markets, freight and handling costs, port throughput costs, financing costs for infrastructure, regulatory fees, and operation and maintenance costs. NGC's LPG prices in Belize are influenced by international LPG prices, which fluctuate due to seasonal demand and market factors.

Belize has taken steps towards sustainable energy and reducing greenhouse gas emissions. The Public Utilities Commission implemented a project to develop a National Energy Policy promoting environmentally sound, safe, reliable, and affordable energy. Additionally, the Belize and Nicaragua Logs Recovery project aims to reduce greenhouse gas emissions and prevent deforestation by salvaging mahogany and other logs in the Belize and Nicaragua Rivers.

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