Petrojam expects steadier fuel supplies, with oil risks still in view

Petrojam expects adequate fuel supplies and relatively contained price movements through the remainder of 2026, provided the Middle East avoids a fresh major upheaval, general manager Danville Walker said at an ICAJ business conference in Kingston.

Increased Middle Eastern crude exports have helped moderate world prices, the Gleaner reported. Jamaica obtains most of its fuel elsewhere but remains exposed to global oil pricing and shipping disruption.

Brent crude was around US$101 a barrel on October 5, down from levels above US$110 during parts of August. The benchmark tracks crude oil in US dollars per barrel, upstream from Jamaica’s wholesale and retail petrol prices.

Petrojam’s wholesale price for 87-octane petrol stood at J$209.62 per litre on October 1, below earlier levels above J$220. The wholesale figure gives a more direct indication of local fuel costs than the crude benchmark, although it still precedes the price charged to motorists at filling stations.

Shipping and logistics problems can delay the effect of lower international prices, Walker said. The timing matters for consumers: an easing in the raw-material market is not necessarily an immediate easing in the cost of fuel already moving through the supply chain.

Walker also said Jamaica’s fiscal position had allowed mitigation through Petrojam. The cost of that mitigation and savings for individual consumers were not given.

Economist Keenan Falconer warned that the full effect of earlier energy shocks had yet to appear in consumer prices. Annual inflation reached 7.9% in August, against 7.5% in July, the Gleaner reported.

Falconer said shocks during March to June could become more apparent between December and the first quarter of the following year. His warning concerns the time it takes earlier energy costs to move into household prices.

Walker’s fuel outlook and Falconer’s inflation warning concern different stages of price transmission. Earlier energy costs can continue moving through the economy while current oil-market conditions improve.