Licensed fuel importers were effectively given the green light by the Regulatory Authority to increase prices despite a ministerial directive to the watchdog to put a cap on charges for six months, the Government said on Sunday.

An emergency meeting was held on Friday, it was revealed, and the RA has been asked to reconsider its position.

Alexa Lightbourne, the home affairs minister, insisted that “every lawful mechanism” would be used to shield Bermudians from higher living costs.

The Government said last week that under the RA’s proposed monthly adjustment, customers would have paid an additional 11.1 cents per litre for petrol, 15.3 cents per litre for diesel and 18.8 cents per litre for kerosene from April 16.

However, Ms Lightbourne formally directed the RA the day before the increase was expected to take effect that it would be repealed by a “standstill ceiling”.

The order specified that no “licensed importer, wholesaler or retailer” would be permitted to charge above the prevailing retail price or the unit-cost-based price supported by the RA's own analysis — whichever was lower — effective for the next six months.

A government spokeswoman said on Saturday: “The purpose was to proactively keep retail fuel prices at their current level and prevent increased prices at the pump due to the instability in the Persian Gulf.

“At the same time, the Ministry of Finance advised that it would offer a customs duty relief measure, building on the approach used successfully in 2022 when fuel prices were last frozen.

“This is intended to ensure that licensed fuel importers and retailers are not affected while fuel prices are frozen.

“In other words, the Government will cover any verified revenue shortfall for licensed importers during this period.”

Ms Lightbourne said last month — as the island monitored the impact of the Middle East conflict on global oil markets — that the Government would work with the RA, which oversees fuel pricing, electricity tariffs and consumer protection, and other stakeholders to safeguard affordability.

The spokeswoman said on Saturday: “Despite this co-ordinated action from the Government, fuel prices were increased after a communication from the RA to licensed importers, which effectively gave them the go-ahead to increase prices.”

She added that the Government had met with the RA commissioners and executive team on Friday to discuss any concerns.

The spokeswoman said that Ms Lightbourne wrote to the authority and its board on Saturday, asking them to reconsider the communication that paved the way for a fuel price increase.

She added: “The matter now rests with the Regulatory Authority board.

“The ministry has also asked the Regulatory Authority to make its decision public and trusts that the board will act in the public interest at a time when many families and businesses are already feeling financial pressure.

Ms Lightbourne said: “The ministry will use every lawful mechanism available to prevent price increases and to protect Bermudian households from higher living costs.”

It was unclear exactly when the communication from the RA was sent to licensed importers.

In her letter to Mark Fields, the chairman of the RA’s board of commissioners, the minister said that retail fuel prices had increased after a “technical communication” from the authority to licensed importers.

She added that the ministry regretted that no further direction was given to the importers after the ministerial directive or after the emergency meeting on Friday.

Ms Lightbourne wrote: “The ministry submits this letter in support of the public outcry at the burden felt, despite its proactive efforts to deliver the mechanism that would allow the board to decide in the public interest.

“The outcome stands at variance with the policy intent of the ministerial direction and with the authority’s statutory duty to consumers and the public.

“Accordingly, the Regulatory Authority is invited to convene the board of commissioners to reconsider the determination that led to the increase, with due regard for the policy intent of protecting Bermudian households from that burden.

“For the board’s assurance, no importer or retailer will be worse off by giving effect to the direction.

“The Ministry of Finance has undertaken to improve the customs duty relief mechanism executed in 2022, so that any verified revenue shortfall during the standstill is offset and those affected are made whole.

“Given the immediate and continuing burden on Bermudian households, the ministry respectfully requests written confirmation of the board's convening and publication of its determination.”

The Royal Gazette has contacted the RA for comment.

• To view Alexa Lightbourne’s letter in full, see “Related Media”

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Letter to RA on the Retail Fuels Price