Renowned economist and former Central Bank of Barbados Governor Dr. Delisle Worrell has delivered a sobering assessment of energy trade dynamics within the Caribbean Community (CARICOM), asserting that member states should abandon any expectation of preferential oil pricing from regional partners. In his March Economic Letter, the distinguished monetary expert—who previously consulted for the International Monetary Fund on financial stability matters—explained that all petroleum transactions among CARICOM nations are conducted exclusively in US dollars, mirroring global market conditions.
Dr. Worrell clarified that Barbados faces identical financial implications whether purchasing fuel from Trinidad and Tobago, the United States, or India. “The impact on foreign currency markets remains consistent regardless of procurement source,” he stated, emphasizing that contract-specific terms might vary but the fundamental economic effect does not differ based on origin.
The analysis reveals surprising trade patterns: despite Guyana’s emergence as CARICOM’s largest oil producer in 2023, no member country currently imports petroleum from this resource-rich nation. Instead, Guyana itself imported $21 million worth of refined petroleum products from Jamaica in 2024—highlighting Jamaica’s refining capacity versus Guyana’s extraction-focused industry. Barbados and Eastern Caribbean Currency Union members do import some fuels from Trinidad and Tobago, though their primary suppliers remain the US and India.
Dr. Worrell identified structural limitations constraining regional energy trade: Caribbean markets remain too small to justify local crude refining or intra-regional shipping operations. Existing refineries were constructed primarily to serve North American markets, with regional sales representing merely residual operations that have stagnated following refinery closures in Trinidad and Aruba.
The economist presented a broader monetary critique: without a commonly adopted regional currency, intra-CARICOM trade provides no foreign exchange advantages to member states. All transactions—whether for petroleum, agricultural products, or manufactured goods—require US dollar payments identical to extra-regional imports. This dollar dependency negates any potential balance-of-payments benefits from increased regional trade.
Dr. Worrell provided historical context, noting that prior to 1971, Caribbean currencies maintained fixed exchange rates against the US dollar, creating de facto regional currency acceptance. The abandonment of this system led to divergent currency values, prompting the creation of the CARICOM Multilateral Clearing Facility in the 1970s—a mechanism that collapsed in the 1980s and was never replaced.
The last serious effort toward monetary integration occurred in 1982 when CARICOM leaders endorsed the West Indian Commission’s proposal for a US dollar-pegged common currency. This initiative required participating nations to meet strict criteria regarding currency stability, foreign reserves, and fiscal discipline. The proposal ultimately failed because Trinidad and Tobago and Jamaica—representing two-thirds of CARICOM’s GDP—could not satisfy these requirements.
Concluding his analysis, Dr. Worrell asserted that after three decades of stagnation, prospects for a common CARICOM currency have effectively vanished. He recommended that regional leaders and populations adapt their exchange rate strategies to acknowledge the US dollar’s permanent dominance in Caribbean trade and finance.