Letter: Diversification via global value chains

Dear Sir:

Trinidad and Tobago’s minister of energy, Mr Franklyn Khan, made an interesting statement in the Budget debate in Parliament to the effect that the return on the refining of crude oil to gasoline, etc. is based on the margin between the refined products and crude oil prices and then on operating costs. Hence, this makes little or no money compared with trading in refined products – buying, distributing and selling.

Hence he expects that replacing the local Petrotrin refinery operation by the selling of crude on the world market and establishing a trading company for refined products would be more lucrative than Petrotrin’s past business model.

This view is supported by the Solomon Report (submitted to Petrotrin), which had this to say on one of its…

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