Chinese Petroleum says no more gas price hikes

Despite significant losses due to rising material costs, the Chinese Petroleum Corp (CPC, 中油) said yesterday that it would implement several measures to rein in costs instead of further raising gasoline prices.

"After the hikes last week, Taiwan's gasoline prices are still lower than those of neighboring countries," CPC president Chen Bao-lang (陳寶郎) said at a media briefing yesterday.

"Although the adjustment did not fully reflect the [rise in fuel]costs, we have no plans to make another price adjustment in the short term," he added.

After posting losses of NT$19.6 billion (US$604 million) in the first half of the year, Chen said the company had set up several measures including capacity enhancement and business diversification that should help it save up to NT$10.7 billion in costs for the full year.

Chen though, that a price hike for liquid natural gas (LNG) would be unavoidable.

The import costs of LNG last month were already up 47 percent from January this year, but the retail price has remained unchanged, Chen said.

While average cost of LNG for the first half of the year reached NT$11.85 per cubic meter, LNG's retail price stayed flat at NT$10.33 per cubic meter, resulting in a loss of NT$8.7 billion from this segment for the company.

CPC proposed a 15 percent hike in LNG prices, which is subject to approval by a committee under the economics ministry tomorrow.