CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) yesterday announced they would increase gasoline and diesel prices by NT$1.8 and NT$1.4 per liter respectively.
The announcements came as severe traffic disruptions in the Strait of Hormuz and Iran’s intensifying attacks on key energy infrastructure in the Middle East keep crude oil prices elevated, the companies said in separate statements.
Gasoline prices should have risen by NT$15 per liter based on international oil prices, but CPC only increased them by NT$1.8 per liter, with the government absorbing NT$13.2 per liter, Premier Cho Jung-tai (卓榮泰) said.
Photo: CNA
CPC has absorbed more than NT$3.4 billion (US$106.35 million) in fuel costs over the past week and nearly NT$6.5 billion since Feb. 28 to help stabilize domestic prices amid Middle East tensions, Cho said.
The government would use the most effective way to prevent CPC from sustaining financial difficulties once the conflict in the Middle East eases, he added.
Effective today, gasoline prices are to rise to NT$30.7, NT$32.2 and NT$34.2 for 92, 95 and 98-octane unleaded gasoline respectively at CPC and Formosa stations, while the cost of premium diesel is to be NT$29.5 at CPC stations and NT$29.3 at Formosa pumps, the companies said.
CPC said that according to its floating oil price mechanism, gasoline and diesel prices should have increased by NT$15 and NT$16.9 per liter respectively.
However, the company would absorb part of the increasing costs in compliance with the government’s policies of stabilizing consumer prices and keeping domestic fuel prices lower than in major neighboring markets, it said.
Formosa set its prices in line with CPC after accounting for trends in the global oil market, price conditions in regional economies, the New Taiwan dollar exchange rate and fierce competition in the domestic market, it said.
The companies’ hikes came as oil supply woes deepened in the Middle East.
Front-month Brent crude oil futures — the international oil benchmark — last week gained 8.77 percent to settle at US$112.19 per barrel on the Intercontinental Exchange in London.
Meanwhile, West Texas Intermediate crude oil futures — the US oil gauge — lost 0.4 percent to US$98.32 per barrel on the New York Mercantile Exchange.
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