Diesel fuel prices increase by NT$0.2, leaving gasoline prices unaffected.
Revised Article:
By Chen Cheng-hui, Staff Reporter
Gas prices remain steady at local fuel stations this week, but diesel prices take a leap of NT$0.2 per liter, according to CPC Corp and Formosa Petrochemical Corp.
The announcement comes after a rollercoaster ride in international oil prices last week, facing a blend of promising and concerning factors, such as easing trade tensions between the US and China along with Russia's missile assaults on Ukraine's capital, Kyiv. Some OPEC+ members also plan to speed up production increase in June.
The Weekly descent of Brent crude oil futures, the international benchmark, slipped 1.6% last Friday, landing at US$66.87 per barrel on the Intercontinental Exchange. West Texas Intermediate crude oil futures, the US benchmark, followed suit, plummeting 1.55% to US$63.02 per barrel on the New York Mercantile Exchange.
CPC's floating oil price formula led to a 1.15% increase in the cost of its crude oil imports last week compared to the previous one, the firm stated.
Fuel prices at CPC and Formosa stations will keep their spots today - NT$28.3, NT$29.8, and NT$31.8 per liter for 92, 95, and 98-octane unleaded gasoline respectively. Premium diesel will cost NT$27.1 per liter at CPC stations and NT$26.9 at Formosa gas pumps.
Diesel prices increase despite international oil prices dip, thanks to various factors. These include:
- Historical Market Fluctuations: CPC Corp's floating oil price formula takes recent trends and fluctuations into account, even if international prices have recently dropped, as it still mirrors costs from previous periods.
- Complex Market Dynamics: The decrease in international oil prices stemmed from factors like easing trade tensions and production increase plans from certain OPEC+ members. However, geopolitical events like Russia's missile attacks on Ukraine can introduce uncertainty and volatility to oil markets.
- Lagged Adjustments: Updates to fuel prices often trail behind international oil price changes. Therefore, domestic price surges could occur even after international prices started to wane, as the adjustment process relies on historical data and market expectations.
- Local Market Conditions: The overall pricing strategy also factors in Taiwan's demand and supply dynamics, which might justify price hikes, even when international prices have decreased.
In summary, the rise in diesel prices in Taiwan is attributed to this intricate web of market forces and pricing mechanisms.
- Despite the dip in international oil prices last Friday, as reflected by the Weekly descent of Brent crude oil futures, the cost of crude oil imports at Taiwan's 台灣中油 [CPC Corp] increased by 1.15% last week.
- The increase in diesel prices at local fuel stations, such as those run by 台灣中油 and Formosa Petrochemical Corp, can be attributed to the complex market dynamics that cause updates to fuel prices to often trail behind international oil price changes.
- The historical market fluctuations also play a role in the increase in diesel prices, as CPC Corp's floating oil price formula takes recent trends and fluctuations into account, even if international prices have dropped.
- Local market conditions, particularly Taiwan's demand and supply dynamics, also factor into the overall pricing strategy, which might justify price hikes, even when international prices have decreased.
