TAIPEI (Taiwan News) — Taiwan will keep gasoline and diesel prices unchanged next week as the government’s fuel price stabilization mechanism takes effect amid rising global energy costs linked to tensions in the Middle East, per CNA.
State-run refiner CPC Corp. on Saturday said prices at its stations will remain at NT$28.90 (US$0.90) per liter for 92-octane unleaded gasoline, NT$30.40 for 95-octane unleaded, NT$32.40 for 98-octane unleaded, and NT$28.10 for premium diesel. Formosa Petrochemical Corp. said it will offer similar prices.
CPC said in a press release that disruptions to shipping traffic in the Strait of Hormuz by Iran have heightened market concerns about crude oil supply shortages, pushing international oil prices significantly higher.
Under the government’s floating oil price mechanism and an expanded commodity tax reduction that takes effect Monday, gasoline and diesel prices would otherwise have risen by NT$9.50 and NT$10.90 per liter, respectively, CPC said. However, the government will absorb these costs, following a policy aimed at keeping Taiwan’s fuel prices among the lowest in neighboring Asian countries.
For electricity, Taipower had initially planned to freeze rates in April and hold a special review meeting in June to assess the impact of the Middle East conflict. The Ministry of Economic Affairs rejected that proposal, requiring Taipower to absorb the increase in fuel costs for now and instead address electricity rates during the regular price review meeting in the second half of the year, per Liberty Times.
Under Taiwan’s electricity pricing formula, there had been room for a rate reduction in April. However, the outbreak of conflict in the Middle East caused a short-term surge in global oil and natural gas prices. The General Chamber of Commerce of Taiwan called for a price freeze in April, while Taipower acknowledged that few are willing to oppose it.
Energy analysts said Taipower may have to forgo much of the profit it recorded last year because of higher fuel costs. Should the Middle East conflict end quickly, global oil and gas prices could fall sharply. At the same time, upcoming year-end elections could make it politically difficult for the utility to raise electricity rates.
