Asian motorists enjoy cheaper petrol amid glut<\/p>\n
SINGAPORE (Reuter): Motorists in Asia are benefiting from
\nfalling petrol prices as oil companies fight for market share
\namid falling international prices, industry sources said on
\nMonday.<\/p>\n
And prices could have further to fall yet with international
\nprices expected to weaken.<\/p>\n
\"Excess Chinese and Korean barrels will return to the market
\nafter August, when their demand eases and will weigh down the
\nmarket,\" said a gasoline trader. \"I am bearish.\"<\/p>\n
Over the past week, prices in South Korea, Singapore and the
\nPhilippines have fallen. Sellers cited weaker international
\nprices and falling and wholesale prices in Singapore.<\/p>\n
Retailers in the Philippines and most other countries in the
\nregion look to Singapore -- Asia's bellwether refining center --
\nfor their cue on prices.<\/p>\n
Asian international gasoline prices have fallen to a 10-month
\nlow, pressuring the wholesale, or ex-refinery price, and retail
\nprices.<\/p>\n
Last week forecourt prices in Singapore fell for the first
\ntime in almost four years.<\/p>\n
The three grades sold in the city state were cut just one
\nSingapore cent per liter to S$1.15 to S$1.337 ($0.80-$0.93) for
\nunleaded 98-octane grade.<\/p>\n
\"But it is peanuts compared to the fall in spot and wholesale
\nprices,\" a gasoline trader with a major oil company said.<\/p>\n
Since the last retail price change at the end of March,
\ninternational prices have fallen 22 percent and wholesale prices
\n18 percent.<\/p>\n
\"It has been quite some time since prices fell, but whenever
\nwe can afford it, we will pass savings on to the consumer,\" one
\nretailer said.<\/p>\n
The reluctance to lower prices has boosted Singapore's retail
\nprices to one of the highest in the region.<\/p>\n
In comparison, other retailers in Asia's main deregulated
\nmarkets have waged war at the pumps instead.<\/p>\n
South Korean refiners raised petrol prices just after price
\nderegulation on Jan. 1, but have been locked in a price war
\nsince.<\/p>\n
In the latest price cut last week, South Korea's largest
\nretailer Yukong Ltd slashed its petrol prices by 14 won per liter
\nto 809 won ($0.91), the lowest level offered by the country's
\nrefiners.<\/p>\n
Yukong was forced into combat at the beginning of June as
\nother refiners started to take its market share.<\/p>\n
\"Yukong's market share of around 38 percent has been reduced
\nby at least one percent since Ssangyong and Hyundai have reduced
\ntheir prices,\" an industry source told Reuters.<\/p>\n
\"Yukong will continue with this strategy to try to recover
\nmarket share,\" he said. \"Most (of the other refiners) will
\nfollow.\"<\/p>\n
Some analysts said they expect the price war in Korea to
\ncontinue for another one or two years.<\/p>\n
On the other hand, Japanese demand is flourishing and
\ncompetition is heating up as retailers try to lure holiday
\ndrivers to the pumps for the peak summer season between July and
\nSeptember.<\/p>\n
In May, a big holiday month in Japan, demand rose five percent
\nyear on year.<\/p>\n
\"I think gasoline demand will be higher this summer compared
\nto last year because pump prices are currently so cheap,\" said a
\ntrader with a Japanese refiner.<\/p>\n
The trader said pump prices are around 90 yen per liter
\n($0.80) compared to last summer's levels of 100 to 110 yen.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/asian-motorists-enjoy-cheaper-petrol-amid-glut-1447893297",
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