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Gas, diesel prices increase today

Beginning today, both the state-owned oil refiner CPC Corp, Taiwan (CPC, 台灣中油) and Formosa Petrochemical Corp (台塑石化), the nation’s only publicly traded oil refiner, will raise domestic gasoline and diesel prices by NT$1.5 per liter and NT$1.6 per liter respectively.

After the price hike, prices for domestic 92-unleaded, 95-unleaded, 98-unleaded gasoline and diesel will be NT$35.4 per liter, NT$36.1 per liter, NT$37.6 per liter and NT$33.5 per liter respectively.

In response to the planned price hikes, drivers yesterday lined up in front of gas stations to pump gas.

The government is sharing a portion of the burden of increasing oil prices by decreasing commodity taxes on gasoline and diesel by NT$1.3 per liter and NT$1.4 per liter respectively, while CPC will absorb NT$1.3 per liter and NT$1.4 per liter, CPC’s latest press release showed.

CPC vice president and spokesman Chu Shao-hua (朱少華), said by telephone yesterday that CPC will continue to absorb losses from increases in oil prices until the end of the year, with losses this year extimated to be around NT$85 billion.

Formosa Petrochemical figures showed that Dubai crude oil prices jumped 6.96 percent month-on-month to US$127.82 per barrel last month, from US$119.5 per barrel in May.

On May 28, after freezing domestic oil prices for seven months CPC raised domestic gasoline and diesel prices by NT$3.9 per liter and NT$4.4 per liter respectively. Formosa Petrochemical followed the next day by raising gasoline and diesel prices by NT$1.1 per liter and NT$1.3 per liter respectively.

Bureau of Energy Director-General Yeh Huey-ching (葉惠青) said that as some consumers expected oil prices to continue rising this month, the amount of fuel dispensed at CPC’s gas stations had gone up to 23 million liters per day over the past few days, up from 18.5 million liters per day, but this was still within a reasonable range.

SHARES DECLINE

Meanwhile, Taiwanese shares closed down 1.5 percent yesterday to a 16-month low partly due to Wall Street volatility, dealers said.

The weighted index closed down 115.56 points at the day’s low of 7,407.98 on thin trading volume of NT$86.06 billion (US$2.83 billion).

“Surging oil prices, which brought down Wall Street prices overnight, remained the major concern of local investors,” said Chen Yu-yu (陳育榆) of Capital Securities (群益證券).

Crude oil hit a record high of US$143.67 per barrel overnight before pulling back.

“If we can hold at 7,384 tomorrow, the market will bottom out there and rebound,” KGI Securities’ (中信證券) Randy Chang (張修華) said.

Dealers said government funds were likely to have purchased large-caps such as Formosa Petrochemical, which rose 2.1 percent to NT$81.90.
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