CPC to raise domestic gasoline, diesel prices next week

Taipei, Sept. 12 (CNA) State-owned oil supplier CPC Corp., Taiwan announced Saturday that it will raise domestic gasoline prices by NT$0.7 (US$0.02) per liter and diesel prices by NT$0.6 per liter next week after international crude oil prices rose above US$100 per barrel this week.

The decision ends a six-week period during which CPC kept fuel prices in Taiwan unchanged to ease domestic inflationary pressure and maintain Taiwan's competitive edge by keeping local fuel prices lower than in neighboring markets.

In a statement, CPC said its recommended retail prices will rise to NT$31.2, NT$32.7 and NT$34.7 per liter for 92, 95 and 98-octane unleaded gasoline, respectively, from midnight Monday through Sept. 20.

The recommended retail price of premium diesel will also rise to NT$29.9 per liter during the same period, CPC said.

Amid escalating military conflicts in the Middle East that have increased risks to crude oil supplies and transportation, CPC said its floating price mechanism, based on a weighted average of 70 percent Dubai and 30 percent Brent crude, showed that the average international crude oil price rose from US$99.82 per barrel last week to US$115.61 this week.

A stronger Taiwan dollar, which averaged NT$31.556 against the U.S. dollar this week, compared with NT$31.682 last week, helped CPC mitigate the impact from higher crude prices to some extent.

Overall, CPC's crude oil price costs rose 12.29 percent this week, the company said.

Despite the hike in domestic fuel prices, CPC said it still expected to absorb a loss of NT$6.8 per liter on gasoline sales and NT$8.7 per liter on diesel sales next week.

CPC estimated that by Sunday it will have absorbed NT$19.85 billion in cumulative losses since the war in the Middle East began by not fully passing on higher crude oil costs to consumers and businesses under the government's price stabilization measures.