Fuel prices in Taiwan are expected to rise sharply next week in the wake of a spike in international crude oil prices, market sources said.
A recent decision by the Organization of the Petroleum Exporting Countries (OPEC) to cut production for the first time in eight years is expected to end a supply glut and has already pushed up crude oil prices. As a result, the state-owned CPC Corp. Taiwan (中油) is likely to raise its gasoline and diesel prices next week by NT$1.0 (US$0.03) per liter and NT$1.1 per liter, respectively, the sources said.
If the price hike is implemented, it will be CPC’s fourth consecutive weekly increase and would follow a NT$0.3 per liter hike in its gasoline and diesel prices this week.
CPC calculates its weekly fuel prices based on a weighted oil price formula that comprises 70 percent Dubai crude and 30 percent Brent crude.
As of Dec. 7, CPC had calculated the price per barrel of crude oil at US$51.76, up from US$47.37 the previous week, according to its website.
At the end of November, OPEC struck an agreement in Vienna to cut oil output by 1.2 million barrels per day with effect from January, which sent crude oil prices soaring as market worry over of an oversupply subsided to some extent.
Although there are some doubts over the implementation of the deal, international crude oil prices have climbed sharply, which would likely prompt CPC to hike its fuel prices again next week, the sources said.
If CPC increases its prices next week, prices at the pump will rise to NT$22.3 per liter for super diesel, NT$24.6 per liter for 92 octane unleaded gasoline, NT$26.1 per liter for 95 octane unleaded, and NT$28.1 per liter for 98 unleaded, according to the sources.
CPC is scheduled to announce its price adjustments at noon Sunday and put them into effect at midnight.
Meanwhile, its main competitor Formosa Petrochemical Corp. (台塑石化), a privately owned supplier, is expected to make an announcement Saturday on its gasoline and diesel prices for next week.
Source: Focus Taiwan News Channel