Taipei-Formosa Petrochemical Corp. (????) said Saturday that it has decided to cut domestic gasoline and diesel prices for next week after international crude oil prices fell this week.
Renewed concerns over a global supply glut weighed on market sentiment after a hike in U.S. crude inventories, sending international crude prices lower for the first time in six weeks.
As a result, Formosa Petrochemical said it will lower gasoline prices by NT$0.3 (US$0.01) per liter and cut diesel prices by NT$0.4 per liter for next week, ending four consecutive weeks of price increases, effective as of 1 a.m. Monday.
After the latest adjustment, prices at Formosa Petrochemical gas stations island wide will fall to NT$23.6 per liter for super diesel, NT$26.1 per liter for 92 octane unleaded, NT$27.5 per liter for 95 unleaded and NT$29.6 per liter for 98 unleaded, the company said.
Formosa Petrochemical said the specter of global oversupply returned to haunt the market. Many energy traders became nervous and pushed down crude prices after a U.S. Energy Information Administration report showed crude inventories in the U.S. rose unexpectedly by 1.9 million barrels for the week to Nov. 10 after a rise of 2.2 million barrels the previous week.
In addition, the private oil company said a move by the Paris-based International Energy Agency (IEA) to cut its forecast of global oil demand added downward pressure on crude oil prices this week.
The IEA cut its estimate of global oil demand by 100,000 barrels a day to an estimated 1.5 million barrels per day in 2017 and 1.3 million in 2018.
Due to weakening crude prices, Formosa Petrochemical's main competitor, state-owned CPC Corp., Taiwan (??), is expected to announce similar price adjustments for next week at noon on Sunday.
CPC calculates its weekly fuel prices based on a weighted oil price formula made up of 70 percent Dubai crude and 30 percent Brent crude.
As of Thursday, the average price of crude oil was listed on its website at US$61.04 per barrel, down US$1.39 per barrel from the previous week.
Source: Focus Taiwan News Channel