After reaching record-high prices earlier this year, fuel prices are heading down yet again as the price of oil on the world market continues to plummet.
The Public Services Regulatory Authority (ARESEP) this week approved the following fuel price reductions, which will take effect next week: a ¢52 drop for super gasoline, from ¢692 ($1.26) to ¢640 ($1.16) per liter; a ¢46 drop for plus gasoline, from ¢670 ($1.22) to ¢624 $1.13); and a ¢3 reduction for diesel, from ¢612 ($1.12) to ¢609 ($1.11).
The National Oil Refinery (RECOPE) last week requested that ARESEP make much larger decreases: a ¢204 ($0.37) drop for super, ¢196 ($0.36) for plus, also known as regular, and ¢90 ($0.16) for diesel.
ARESEP has up to 15 weekdays to rule on a request for a fuel price change. However, to offer a reduction to consumers more quickly, ARESEP has agreed to give an initial break starting next week and the rest next month.
The price drop was accelerated to offer consumers in Costa Rica the same price relief occurring in other parts of the world, said Fernando Herrero, RECOPE’s general regulator.
The rest of the requested fuel decrease is expected to come in mid-December, when prices would drop ¢152 for super, ¢150 for plus and ¢87 for diesel fuel, ARESEP said.
In January, super gasoline cost about ¢562 per liter but peaked at ¢737 by the end of August. Plus rose from ¢551 in January to ¢726, while the price of diesel increased from ¢521 in January to a high of ¢729 at the end of August.
In contrast with the United States and other developed countries, where fuel prices are determined by supply and demand on the open market, Costa Rican gas prices are set by ARESEP.
RECOPE usually recommends an increase or decrease of fuel prices to ARESEP, which then approves or denies it within 15 weekdays.
Mid-way through the year, RECOPE had requested seven fuel increases as a result of the rising price of petroleum and the decreasing value of the colón.
The price of crude oil closed on July 10 at a historic high of $147 per barrel. On Thursday day, the price had dipped to below $50 a barrel.
ARESEP, which also sets bus fares, said they are considering a “historic reduction” of 4.69 percent sometime soon.
In addition, ARESEP announced it is changing the process by which fuel price reductions or increases are made.
The new methodology would reduce the calculation period for the average international price of oil reference from 30 days to 15.
It also includes setting a price for biofuels and defines a number of prices for selling the product to large consumers, like airports and seaports, among other stipulations.