Gas stations supplied by the Chinese Petroleum Corp (中油) and arch rival Formosa Petrochemical Corp (台塑石化) traded blows yesterday with each successively lowering prices to below the level at the start of the week prior to recent increases.
Eleven gas stations supplied by Chinese Petroleum in northern Taipei yesterday at noon slashed prices by NT$1 per liter for gasoline products and NT$0.5 for diesel fuel, undercutting its rival, according to a spokesperson.
Seven gas stations across Taipei supplied by Formosa responded in the early evening by also dropping prices by a similar margin, maintaining lower prices over Chinese Petroleum, according to an official at the association representing the gas stations.
The move came one day after the same seven stations supplied by Formosa around Taipei lowered their prices for unleaded gasoline by NT$0.8 per liter and by NT$0.4 per liter for diesel.
Chinese Petroleum stations across the city had responded by dropping their prices by NT$0.3 per liter for gasoline and NT$0.1 per liter for diesel.
But Chinese Petroleum's gasoline prices were still higher at the pump by NT$0.5 and NT$0.3 per liter as Formosa had already undercut its rival earlier in the week when both companies raised wholesale prices.
While Chinese Petroleum had raised gasoline and diesel prices by NT$1 and NT$0.5 per liter respectively on higher global prices, Formosa followed by raising prices by only by NT$0.80 for gasoline and NT$0.40 for diesel fuel per liter.
The new price made Formosa's gasoline cheaper than that offered in the same areas by Chinese Petroleums's by NT$0.2 for gasoline and NT$0.1 for diesel.
The cuts put the prices for gasoline and diesel below the original cost at the start of the week.
On Monday the price for 95 octane unleaded gasoline was NT$18.2 per liter and NT$13.6 per liter for premium diesel.
The Formosa supplied stations are now offering gasoline for NT$17.2 per liter and NT$13.1 per liter for diesel.
The lower prices come as international oil prices broke a 10-day rally and ended lower yesterday as traders took profits from annual highs spurred on by fears of US action against Iraq in the Persian Gulf.
International benchmark Brent crude oil slipped US$0.39 to US$27.02 per barrel in London, pulling back from a four-month high the previous day.
US crude futures were US$0.40 down at US$28.84, breaking a 10-day rally that pushed prices to an 18-month high above US$30 a barrel earlier this week.
Despite some modest selling on Thursday, prices are still about 10 percent up over the last two weeks. Analysts attribute the strength to signs of thinning oil inventories in a season when they normally rise ahead of the winter peak demand period.
Traders said Wall Street investment banks had been the main buyers on Thursday on sentiment the market could go higher because of a possible US military attack on Iraq.
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