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CPC raises gasoline prices

State-run CPC Corp, Taiwan (CPC, 台灣中油) announced yesterday it was raising wholesale gasoline prices by NT$0.40 and diesel prices by NT$0.70 per liter, as a result of oil prices hitting record highs during the past week. The new rates came into effective at midnight.

The adjusted retail price for 98-octane unleaded gasoline is NT$29.50 (US$0.89), 95-octane unleaded gasoline NT$28, 92-octane unleaded gasoline NT$27.30 and top-grade diesel oil NT$24.60 per liter, the company said in a statement yesterday.

CPC said gasoline prices should have gone up by NT$0.7 per liter to fully reflect the costs, but that to ensure the nation's gasoline rates were the lowest among neighboring Asian countries, it only raised prices by NT$0.40 per liter.

Smaller rivals Formosa Petrochemical Corp (台塑石化) later yesterday said it would also increase its prices, too, effective from 2am today. While it would match CPC's hikes in both 92-and 95-grade gasoline products, Formosa said it would increase its 98-grade gasoline by NT$0.70 per liter.

Following a promotional campaign last week, Taiwan Sugar Corp (Taisugar, 台糖) announced yesterday it would offer unleaded gasoline at NT$0.80 per liter, lower than CPC and Formosa Petrochemical.

The promotion came into effect at midnight and will run through the end of Saturday, the company said in a statement. Taisugar has 68 gas stations nationwide.

Meanwhile, CPC said yesterday that its chairman Pan Wenent (潘文炎) had inked a US$5 million-contract with Libya's National Oil Co on Monday to explore Libya's Murzuq 162 oil field.

CPC plans to invest US$3.4 million in the 4,300km2 field and drill three oil wells, according to the statement.

If the drilling is successful, oil reserves in the field are anticipated to be 500 million barrels, CPC said.

The contract stipulates that CPC can exploit oil products from the field for 25 years should it find reserves there over the next five years. Otherwise, CPC is required to return the field, the statement said.

CPC has since September linked gasoline and diesel prices to benchmark crude oil traded in New York. It reviews them weekly, based on oil costs over the previous seven days. Formosa Petrochemical has followed all the adjustments by the state-run company.

CPC controls about 75 percent of the nation's gasoline and diesel market, while Formosa Petrochemical has the remainder. Crude oil in New York soared 4.8 percent last week as 15 British naval personnel seized in the Persian Gulf remained in Iranian custody, heightening concern the standoff will threaten oil shipments.

additional reporting by Bloomberg
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