One of the arguments used by proponents of fossil fuel subsidies in Trinidad and Tobago is that the gasoline or diesel that they put into their tanks is produced in the country and, therefore, belongs to them and should be provided to them at a low price. In reality, on average, more than half of the hydrocarbon molecules going into any gasoline or diesel tank will actually have been produced in another country and imported to Trinidad and Tobago to be refined at the Point-a-Pierre refinery. The hydrocarbon molecules going into your tank could be from Trinidad and Tobago, but they also could be from Russia, Gabon, Brazil or Colombia.
Petrotrin has to import significant volumes of crude oil for the Pointe-a-Pierre refinery because the capacity of the refinery significantly exceeds domestic production of crude oil. Currently the refinery’s capacity is around 150,000 barrels per day (bpd), with the country only producing around 70,000 bpd of which around 42,000 bpd goes to the Petrotrin refinery. The balance of the domestic production is directly exported as unrefined crude oil, as international oil companies sell to their preferred markets to maximise returns.
Trinidad and Tobago’s oil imports come from several different countries and the volumes shift over time as Petrotrin’s crude oil purchasing department seeks out the best deals and the best mix of crude oils to run the refinery effectively. Between January and July 2017, Petrotrin imported a total of 18.6 million barrels of crude oil, with Russian crude oil accounting for the major share at 32 per cent.
The volumes of oil being imported by Petrotrin have increased over the past few years as the refinery throughput has increased, while domestic crude oil production has continued to slide. While the country has benefitted from the additional foreign exchange earned by Petrotrin’s sale of petroleum products to international markets, these benefits have been offset by the fact that foreign exchange has had to be used to purchase crude oil.
In 2016, Petrotrin imported a total of 37 million barrels of crude oil, its highest ever volume of imports and significantly up over the previous three years. With domestic sales of petroleum products relatively stable at around 10 million barrels, these increased imports allowed Petrotrin to significantly increase export sales. However, the net benefit to the company and to the country, not least in terms of foreign exchange availability, would be much greater if the export sales growth came from domestic increases in crude oil production.