Banks will earn lower fees from guaranteeing oil dealers in making global payments for imported petroleum stocks if the energy regulator adopts a proposal to cut costs attached to the lenders’ letters of credit.
A study by the Energy Regulatory Commission (ERC) recommends a reduction in the fees charged by banks on their letters of credit from the current allowable maximum of 1.2 per cent of the cost of the petroleum cargo to 0.8 per cent.
