Current hike in gas prices could double under higher minimum wage
By John McPhaul
Carlos Crespo, former president of the Puerto Rico Gasoline Retailers Association, said Thursday in a radio interview that the price of gasoline rose three cents per liter between Wednesday and Thursday.
“Yesterday [Wednesday] gasoline rose a penny. Today [Thursday] it was up two cents” Crespo told Normando Valentín on Notiuno 630. “It has been a long time, months, years, that [the price of] gasoline has risen so fast.”
“There are two factors here,” Crespo said. “The main factor is the restriction of the increase, to lower production. And secondly, consumption shoots up, once the releases are made in the United States regarding COVID, and as far as the snow is over, everyone goes out to the streets. This is the supply and demand factor. Now there is more demand for gasoline but there is less supply; therefore, the demand has increased, thus forcing the price of gasoline to rise.”
As for how the present situation of the price of gasoline compares to the past, Crespo said “it was [a rise] from week to week. And it went up a penny and down a penny. Yesterday [Wednesday] it went up a penny. And today [Thursday] it rises an additional two cents.”
Meanwhile, Crespo said, in Puerto Rico there are around 1,150 gasoline stations “open.”
Previously, he said, “[t]here were 1,500 at any one time.” “We are talking about at least eight to 10 employees per station,” he said. “We are talking about, between direct and indirect jobs, more than 20,000 people.”
Crespo added that the jobs pay “$7.25 an hour, and are not available.”
He pointed out that if the minimum wage goes up, the retailers will be forced to increase the price of gasoline.
“If the minimum wage is applied at $9, then the gasoline margin has to go up. Why? Because we have been with the same margin for 20 years, the most we have been able to have is up to 15 cents and with that we cannot cover the costs for the $9 an hour,” Crespo said. “If we had to raise [the price of gasoline] to meet the minimum wage of $9, we would have to raise it by 25 to 30 cents a gallon,” which is equivalent to between six and seven cents per liter.