LNG cost to be lowered due to falling prices

The margin of decline will be about NT$4 to NT$5 per kilogram, translating into a saving of NT$80 to NT$100 for a 20-kilogram LNG tank, the local United Evening News reported yesterday.

As for natural gas delivered through the pipes to households, CPC is not ready to lower its price yet.

The international natural gas price is still at a high, and CPC has lost NT$30.7 billion selling it from January to September, the paper said. It is estimated CPC will lose about NT$2.5 billion a month if the current international price level stays unchanged. “There is no room for a price decrease for natural gas, as we’re losing NT$2.6 for each unit of natural gas we sell,” said CPC acting president Chu Shao-hua.

As for industrial-use fuel oil, many enterprises are wondering whether there will be a price decline for that. The paper reported as the pricing of fuel oil is dictated by a monthly floating mechanism, CPC needs to wait until Nov. 1 to decide whether to lower its price. But, based on declining oil prices, CPC is likely to lower fuel oil’s price by NT$1,000 to NT$2,000 per kiloliter, the paper said.

LNG and natural gas are used by many a household and restaurant in Taiwan for cooking and heating things. Their price decrease has long been anticipated amid this current price decline in oil prices.

“In our household, we use about three tanks of LNG for a two-month period. However, in our city, a 20-kg LNG tank had risen from NT$700 to NT$900,” the paper reported, citing a resident of Chungho, Taipei County, surnamed Hsieh.

One resident of Neihu, surnamed Ling, was quoted as saying he was shocked to hear natural gas prices won’t go down. “In the past, each unit of natural gas was NT$15, yet it got raised to over NT$20 since May,” he said. “Based on our monthly usage of 30 units, that’s an increase of NT$150 on our bills.”

In a related story, many restaurant and owners expressed their dismay at a call by the Consumers’ Foundation that food retailers should cut down on prices, now that prices of commodity products have gone down.

A small restaurant owner, surnamed Wang, said in contrast to the foundation’s remarks, prices of cooking oil and flour at the wholesale level are still at a high.

“Wholesale prices of cooking oil had increased from NT$90 per barrel to NT$150, and they have not gone down. Also, a 20-kg bag of flour was sold for NT$400, but now it’s NT$600, and there’s no sign of a price decline,” Wang said. “Rather than asking us to cut prices, the government should investigate why wholesalers continue to keep prices at a high.”

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