Petrol and diesel prices drop again
Latest cut is 14th since July; prices at their lowest in nearly 20 months
By Christopher Tan, Senior Correspondent
PRICE cuts at the pump have become a weekly affair.
Petrol stations, led by Caltex and Shell, yesterday slashed petrol and diesel rates by five and six cents a litre respectively, just a week after the last reduction.
The latest cut was the 14th consecutive drop since July, and has brought fuel prices to their lowest levels in nearly 20 months.
A litre of 92 octane petrol now costs $1.603 before discount, 95 octane is $1.636 and 98 octane is $1.71. The prices are nearly 30 per cent lower than July’s highs.
Shell V-Power and Caltex Platinum, so-called ultra-premium grades, are now $1.839 and $1.836 a litre respectively, before discount. A litre of diesel costs $1.373, also before discount.
Pump prices have been sliding on the back of sharp drops in crude oil prices. Oil is now hovering at merely a third of its record US$147 a barrel in July.
Demand for oil is down as the financial crisis has forced factories to curtail production, motorists to drive less or switch to smaller cars, and most significantly, it has crippled speculative trading in oil.
The fuel dipped below US$55 a barrel on Monday as news of Japan sliding into recession rattled business and consumer confidence further. But the raw material has since risen to US$58 a barrel.
Efforts by the Organisation of the Petroleum Exporting Countries (Opec) to cut output further are expected to prop up prices.
Oil industry consultant Ong Eng Tong however feels production cuts ‘are not so easy in practice to implement and police’.
But Mr Ng Weng Hoong, editor of energy news portal EnergyAsia.com, is sticking to his forecast that oil will hit US$200 a barrel by 2013, saying the current situation is a ’short-term weakness’.
Source : Straits Times - 19 Nov 2008
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