Costa Rica News – If you need to fill up the car you might want to do so before March as Recope is already increasing the price at the pump again.
If approved (which it probably will be – why would the government not increase the amount of revenue it is receiving), this would be the first increase in rates of fuel since July of 2014. There were 8 consecutive cuts.
The Regulatory Authority for Public Services (Aresep) has two weeks to evaluate this request for the adjustment and the new prices would come into effect in early March.
For a little moment I thought the Costa Rican government had some sort of brain power being that its unemployment rate is nearing 10% and it’s economic stability is slowly declining. Decreasing the price at the pump will lead to cost of living decreases in the long term which can decrease poverty and stimulate the economy, but a 6 month decrease in fuel prices does nothing.
But Why the Increase?
- Recope is citing the fact that there has been an increase in costs in the market. Yes since July of last year a barrel of oil has gone from around $100 a barrel to just recently where is dropped close to $45. (Cost of Barrel of Oil Over the Past Year). There has been a small increase over the past 14 days but did Recope did decrease their price at the pump this drastically over the same period as quickly as they are increasing?
- Recope also cited the fact that there has been a workers strike in several US refineries which has put “64% of the finished products at risk”. Got a great idea Recope, how about you refine your own fuel? But then we would have to rely on a incompetent government monopoly to be cost efficient and not pass their shortcomings and screw ups onto the public. Quite the conundrum.
- Finally is the fact that US refineries will start a holding period as between June and September is the greatest demand in the USA for fuel as you have summer vacation and family trips.
So by this reasoning we should expect more increases at the pump over the next few months as summer approaches in the north. Although the rates of gas has decreased from over ¢ 800 to the rates they are at now, there has to be a better solution than the current monopoly that is in place.