Falling oil prices prompt spending cuts

Trinidad’s minister of finance, Larry Howai, on Thursday said that each ministry in the country will reduce its spending by $45 million in 2015 due to falling oil prices. The 2015 budget recently unveiled pegs Trinidad’s reference price to $80 per barrel and $2.75 per British thermal unit. With the oil price set to drop up to 25 percent, while the gas price should remain steady, reduction in the country’s revenue will still fall $1.88 billion per year.

Savings of $507 million will be accrued because of fuel subsidies, thus resulting in an increase to the country’s deficit of $1.37 billion or 0.7 percent of GDP. The ministry has targeted state-owned oil and gas company Petrotrin to identify a short- and medium-term solution to combat Trinidad’s total debt of $14 billion.

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