According to the Ministry of Economic Affairs proposal, subsidies of US$0.09 per liter for diesel fuel would be offered for mass-transit buses and US$0.06 per liter for taxicabs' gasoline, Chang noted, adding that the government still supported the floating fuel pricing mechanism launched by the MOEA Jan. 1 despite criticism from many quarters.
The premier said this mechanism was open, fair, transparent and accorded with expectations for social justice and energy conservation. Furthermore, Chang emphasized that Taiwan's oil prices were the lowest in comparison with other Asian competitors.
The coming subsidies would be canceled if oil prices dropped below the subsidization level or if bus and taxicab operators increased their fares, MOEA Minister Chen Ruey-long stressed at a press conference that followed the Cabinet meeting, the Chinese-language China Times reported July 26. Chen estimated that CPC would spend approximately US$3 million in monthly subsidies for gasoline and US$2 million for diesel.
The Consumers' Foundation, Chinese Taipei criticized the new subsidy program, claiming the MOEA's floating pricing mechanism was fundamentally wrong, the China Times quoted. The CFCT argued it was unreasonable that the CPC purchased crude oil from the Middle East and West Africa at low prices but used the West Texas Intermediate as a benchmark for the pricing mechanism.
Domestic gasoline prices have risen by an average of US$0.09 per liter over the seven months since the mechanism was launched. The price of 92-octane unleaded gasoline rose from US$0.77 to US$0.88 per liter, of 95-octane unleaded gasoline from US$0.79 to US$0.90, of 98-octane unleaded gasoline from US$0.84 to US$0.95, and of top-grade diesel oil from US$0.68 to US$0.81.
Local bus and taxicab operators responded differently to premier's announcement, the Chinese-language Liberty Times reported July 26. Taiwan's public bus companies association said its members, although originally proposing slight fare raises, were inclined not to do so after the subsidy program took effect. Taxi drivers associations in Taipei and Tainan, however, still proposed fare-adjustment packages to deal with rising oil prices, the report stated.
In related news, the Executive Yuan asked the MOEA and Council of Agriculture to closely monitor the balance of supply and demand of major raw materials in the agricultural and industrial sectors, the China Times reported. Furthermore, the MOEA should actively help businesses improve their operational efficiency and seek alternative, cheap sources of supply for major raw materials, the report stated.
Write to Allen Hsu at allenhsu@mail.gio.gov.tw