Minister: Realistic fuel pump prices needed
Wednesday, January 9, 2008
THE Minister of Energy yesterday said setting fuel pump prices at "realistic rates" is essential in order to reduce customer usage to more sustainable levels.
As world oil prices remain high at US$90 a barrel, the government is beginning to feel the strain on its heavy subsidies of refined oil products. It is currently subsidising 72 per cent and 53 per cent of overall costs — for diesel and Premium 97 respectively — for domestic consumption.
"Fuel prices in this country is far lower when compared to the nearest neighbouring country — where a litre of diesel fuel costs 72 cents and a litre of Premium 97 costs 86 cents," said Pehin Orang Kaya Seri Utama Dato Seri Setia Hj Yahya Begawan Mudim Dato Paduka Hj Bakar at an Energy Week Roadshow in Temburong district.
"The gap between actual production costs and pump prices will continue to widen because of the rise in international oil prices to US$100 per barrel. However, pump prices in this country continue to remain the same," said the minister, who voiced out his concern on Brunei's high levels of oil usage. World oil prices hit the historic US$100 a barrel level last Wednesday but eased to the US$97 region.
While many other countries have taken steps to ensure pump prices actually depict the commodities through market prices, Pehin Dato Hj Yahya said the government has issued several directives on the matter. Awareness campaigns have also been organised by the ministry to promote a change in how energy is used.
However, the minister said, "even with the steps the government has taken, it is worrying that oil usage in Brunei still does not truly reflect the country's population and industrial activities," citing cheap pump prices as the main reason oil usage in Brunei is far higher than other countries.
"In this matter, I myself can imagine that setting the market prices of refined oil products at realistic rates is needed to reduce consumer usage in this country to more sustainable levels," he said.
"Realistic market price rates will ensure a change in attitude of users," he added.
The minister's announcement comes in light of His Majesty the Sultan and Yang Di-Pertuan of Brunei Darussalam's 2006 titah calling for a reduction in the subsidy for Bruneians for petrol usage. A hike in fuel prices at petrol stations could be a very effective way to bring down consumer usage of oil products to sustainable levels.
But only one important question remains — are Bruneians truly ready to start using alternative means of more cost-effective of transport such as buses, bicycles, motorcycles or even carpooling to get around, for the sake of sustainability?
The answer, as sadly illustrated by the rest of the world, is no. The Brunei Times
As world oil prices remain high at US$90 a barrel, the government is beginning to feel the strain on its heavy subsidies of refined oil products. It is currently subsidising 72 per cent and 53 per cent of overall costs — for diesel and Premium 97 respectively — for domestic consumption.
"Fuel prices in this country is far lower when compared to the nearest neighbouring country — where a litre of diesel fuel costs 72 cents and a litre of Premium 97 costs 86 cents," said Pehin Orang Kaya Seri Utama Dato Seri Setia Hj Yahya Begawan Mudim Dato Paduka Hj Bakar at an Energy Week Roadshow in Temburong district.
"The gap between actual production costs and pump prices will continue to widen because of the rise in international oil prices to US$100 per barrel. However, pump prices in this country continue to remain the same," said the minister, who voiced out his concern on Brunei's high levels of oil usage. World oil prices hit the historic US$100 a barrel level last Wednesday but eased to the US$97 region.
While many other countries have taken steps to ensure pump prices actually depict the commodities through market prices, Pehin Dato Hj Yahya said the government has issued several directives on the matter. Awareness campaigns have also been organised by the ministry to promote a change in how energy is used.
However, the minister said, "even with the steps the government has taken, it is worrying that oil usage in Brunei still does not truly reflect the country's population and industrial activities," citing cheap pump prices as the main reason oil usage in Brunei is far higher than other countries.
"In this matter, I myself can imagine that setting the market prices of refined oil products at realistic rates is needed to reduce consumer usage in this country to more sustainable levels," he said.
"Realistic market price rates will ensure a change in attitude of users," he added.
The minister's announcement comes in light of His Majesty the Sultan and Yang Di-Pertuan of Brunei Darussalam's 2006 titah calling for a reduction in the subsidy for Bruneians for petrol usage. A hike in fuel prices at petrol stations could be a very effective way to bring down consumer usage of oil products to sustainable levels.
But only one important question remains — are Bruneians truly ready to start using alternative means of more cost-effective of transport such as buses, bicycles, motorcycles or even carpooling to get around, for the sake of sustainability?
The answer, as sadly illustrated by the rest of the world, is no. The Brunei Times
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