Mon, Apr 02, 2012 - Page 1 News List

Fuel costs up as ministry revokes curb

CRUDE EFFECT:The effect of increasing crude prices is forecast to reduce Taiwan’s GDP by 0.22 percentage points this year and push up consumer prices 0.37 points

By Crystal Hsu  /  Staff reporter

Meanwhile, the price of CPC’s diesel will climb from NT$29.9 to NT$33.1 per liter, he said.

“The price increases are uneven, so owners of expensive cars will take on more of the burden,” Ou said.

To ease the impact on public transportation, the ministry raised its bus subsidy from the current NT$2.4 a liter to NT$5 a liter, while the taxi subsidy will go from NT$2 to NT$5 per liter with a quota of 450 liters a month, Ou said.

Meanwhile, the ministry will maintain its price increase restriction on liquefied petroleum gas, given the heavy dependence of small food stores and low-income households on the fuel product, Ou said.

In terms of industry, cement, textile and dye companies will be the hardest hit and the government will help work with them to cut oil consumption, Shih said.

Overall, the price hikes will add 0.1 percent to manufacturing costs, the minister said.

Shih also confirmed that the ministry is assessing the possibility of raising utility rates, but he added that it might not reach a conclusion in the short term.

The minister promised to review CPC’s oil procurement and personnel compensation policies, and deliver a report in three months, in reply to challenges over the need for price hikes.

Crude oil costs account for 85 percent of total CPC spending, while personnel outlays make up a modest 2.2 percent, CPC chairman Chu Shao-hua (朱少華) said. He expects crude oil to trade at an average of US$120 a barrel this year.

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