Taipei: State-owned oil supplier CPC Corp., Taiwan, announced on Saturday that it will implement an increase in domestic gasoline and diesel prices next week. This decision follows a surge in international crude oil prices, which have risen above US$100 per barrel.
According to Focus Taiwan, the upcoming price adjustments will see gasoline prices increase by NT$0.7 (US$0.02) per liter and diesel prices by NT$0.6 per liter. This marks the end of a six-week period during which CPC maintained steady fuel prices to alleviate inflationary pressures and keep Taiwan's market competitive by offering lower local fuel prices compared to neighboring regions.
In its official statement, CPC detailed the new recommended retail prices, which will be NT$31.2, NT$32.7, and NT$34.7 per liter for 92, 95, and 98-octane unleaded gasoline, respectively. These changes will take effect from midnight Monday and remain until September 20. The price for premium diesel will also rise to NT$29.9 per liter within the same period.
CPC attributed the price hike to escalating military conflicts in the Middle East, which have heightened risks associated with crude oil supply and transport. The company's floating price mechanism, which utilizes a weighted average of 70 percent Dubai and 30 percent Brent crude, indicated an increase in the average international crude oil price from US$99.82 per barrel last week to US$115.61 this week.
The impact of rising crude prices was partially offset by a stronger Taiwan dollar, which averaged NT$31.556 against the U.S. dollar this week, compared to NT$31.682 last week. Nonetheless, CPC reported a 12.29 percent increase in crude oil price costs over the week.
Despite the increase in domestic fuel prices, CPC anticipates incurring a loss of NT$6.8 per liter on gasoline sales and NT$8.7 per liter on diesel sales next week. The company estimates that by Sunday, it will have absorbed NT$19.85 billion in cumulative losses since the onset of the Middle East conflict, due to the government's price stabilization measures preventing the full transfer of higher crude oil costs to consumers and businesses.