Taipei-, Domestic gasoline and diesel prices are likely to move lower next week after international crude oil prices slipped amid lingering concerns over whether a deal by major oil producers to cut production will actually be carried out.
Lower crude oil prices are expected to lead state-owned CPC Corp. Taiwan (??) to cut its gasoline and diesel prices by NT$0.3 (US$0.09) per liter in the coming week.
CPC is scheduled to announce its price adjustments at noon Sunday and put them into effect at midnight.
This past week, CPC raised its diesel prices by NT$0.1 per liter but left gasoline prices unchanged.
If CPC adjusts fuel prices for the coming week as the market expects, prices at the pump will fall to NT$22.8 per liter for super diesel, NT$25.0 per liter for 92 octane unleaded gasoline, NT$26.5 per liter for 95 octane unleaded, and NT$28.5 per liter for 98 unleaded, sources said.
CPC calculates its weekly fuel prices based on a weighted oil price formula comprised of 70 percent Dubai crude and 30 percent Brent crude.
As of Jan. 12, the CPC formula yielded a crude oil price of US$53.49 per barrel, down from US$54.57 the previous week, according to CPC's website.
Crude oil prices staged a rebound overnight Thursday after Saudi Arabia, the largest oil producer in the Organization of the Petroleum Exporting Countries (OPEC), said it had lowered its oil exports to Asia under the output cut agreement reached by OPEC and non-OPEC producers late last year.
That agreement, which took effect on Jan. 1, aimed to cut production by about 1.8 million barrels per day.
Crude oil prices also bounced back after it was reported that car sales in China in 2016 rose 13.7 percent from a year earlier to 28 million, which could lead to an increase in fuel consumption, sources said.
But those positive factors were not enough to offset losses earlier in the week caused by worries over whether the output agreement will be carried out as hoped.
Iraq, in particular, was a source of concern after OPEC's second largest oil producer reported a new high in crude oil exports, sources added.
In addition, energy companies in the United States added oil rigs last week for a 10th week in a row, which has raised fears of a supply glut and sent crude prices lower, sources said.
Source: Focus Taiwan News Channel