Premier says fuel prices will not be raised -- for now

Premier Frank Hsieh (謝長廷) said yesterday that the government has determined a three-month period to observe global crude oil prices and that it will only consider adjusting fuel prices upward if the price of crude remains high after that period.

Hsieh made the remarks while delivering an administrative report at the Legislative Yuan.

With the oil price surging, the privately owned Formosa Petroleum Corp (台塑石化) announced a gas price hike of NT$2.4, or almost 10 percent, on Aug. 31.

He said that although the price of oil has now dropped to around US$65 per barrel, analysts have diverging views on the oil-price trend and this is why the Ministry of Finance, the Ministry of Economic Affairs and the Council for Economic Planning and Development have decided to observe the situation for three months before determining how to act.

The premier said that during the three-month period, the government is considering adjusting downward the commodity tax on some petroleum products so as to reduce the pressure on state-run Chinese Petroleum Corp (中油).

Hsieh reaffirmed that not hiking gasoline prices and electricity fees will be given priority consideration and that other complementary measures will be taken.

He also said that the consumer price index rose last month largely because of the effect of higher agricultural-produce prices.

Separately, Hsieh said the government is not asking Chunghwa Telecom Co (中華電信) to invest in Taiwan High Speed Rail Corp (台灣高鐵) for the time being, and, as the telecom company has been privatized, what it does in the future will be decided by its board.

He made the remarks in reply to a question posed by People First Party legislators Wu Ching-chih (吳清池) and Chen Chao-jung (陳朝容).

The premier said that the government supports the construction of the high-speed railway but does not have a policy of asking Chunghwa Telecom to invest in the project. Inauguration of the high-speed railway service was recently postponed by a year until October next year.

As Chunghwa is now a private company in which the government is but a shareholder, the question of whether it will invest in the high-speed rail will have to be decided by its board of directors and supervisors, Hsieh said.