Sat, May 12, 2018 - Page 1 News List

New fuel pricing strategy to ease consumer burden

ABSORBING DAMAGE:In response to high oil costs, next week’s fuel prices would be based on a new formula, the Ministry of Economic Affairs said

By Kuo Chia-erh  /  Staff reporter

A CPC Corp, Taiwan, gas station is pictured on Bade Road in Taipei yesterday. The Ministry of Economic Affairs yesterday announced a new fuel pricing mechanism to help mitigate the effects of rising global crude oil prices on consumers.

Photo: Wang Yi-sung, Taipei Times

Minister of Economic Affairs Shen Jong-chin (沈榮津) yesterday announced a new fuel pricing mechanism to help ease the burden on consumers, in response to rising global crude oil prices.

State-run CPC Corp, Taiwan (CPC, 台灣中油) would absorb part of the cost increases if the price of 95-octane unleaded gasoline rises above NT$30 per liter, Shen said.

CPC previously calculated its weekly fuel prices based on a floating price mechanism, with a weighted oil price formula made up of 70 percent Dubai crude and 30 percent Brent crude.

Under the new scheme, if the benchmark price reaches between NT$30 and NT$32.4 per liter, CPC would absorb 25 percent of the increase in fuel prices, while consumers would pay the remaining 75 percent.

If the price grows to between NT$32.5 and NT$34.9 per liter, CPC and local consumers would each shoulder half of the increase, the ministry said.

If the price climbs to more than NT$35 per liter, consumers would pay 25 percent of the increase in fuel prices, with the government and CPC absorbing the rest, it said.

On Sunday, CPC would announce next week’s fuel prices based on the new formula, the ministry said.

The move came as oil prices hover at their highest levels in three-and-a-half years after the US announced its withdrawal from a nuclear deal with Iran.

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