ID :
191524
Tue, 06/28/2011 - 11:47
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Shortlink :
https://oananews.org//node/191524
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Concerted efforts of gov't, refineries, gas stations necessary for soft landing of oil price hike
SEOUL, June 28 (Yonhap) -- The voluntary reduction of oil prices by refineries is scheduled to end on July 6, and the prices will return to the level of three months ago.
In April, the nation's major refineries began a temporary reduction in their oil prices by 100 won per liter, in line with the government's call for help to ease soaring gasoline and diesel prices.
It is worrisome that there are difficulties in buying some oil products at gas stations. Signs reading "sold out" for diesel are easily seen at many gas stations. The refineries suspect oil dealers and gas station owners have stockpiled products in order to gain large profits after the prices are raised, while gas stations claim the refineries do not supply them with sufficient oil products.
The government vows stern measures against production stoppages by refineries and stockpiling by retail sellers.
"We will strictly deal with any irregularities by gas stations," Vice Finance Minister Yim Jong-yong said. "The government will take stern measures, including business suspension or criminal charges, against any unwarranted production stoppages, supply reduction or restraints on shipments and sales (of oil)."
The government will keep an eye on business irregularities in a bid to minimize possible inconveniences among consumers, he added.
The Knowledge Economy Ministry also warned in a statement that it will operate special teams to crack down on irregularities by refineries, oil agents and retail sellers.
Refineries, oil agents and gas stations should make voluntary efforts to establish market order before the government's crack down.
The return to the high oil prices after three months of reduction will likely hit consumers hard both economically and mentally. Consumers have suspected that oil prices did not go down by 100 won per liter as refineries promised. Some consumer organizations claimed the actual price drop was just 60 won. If oil prices go up 100 won per liter next month, the price hike will far surpass the actual reduction three months ago, they insist.
There are also worries of chain reactions that the oil price hike could have on consumer prices. The prices of oil derivatives account for 5.4 percent of consumer prices. Government officials admitted inflation would continue to grow for the time being, which will eventually increase the burden of consumers, especially low- and mid-income people.
So the government, oil refineries and sellers should make concerted efforts in order to soft-land the oil price hike.
Refineries are advised to make gradual price hikes instead of raising the price by 100 won per liter at one time. The government had better consider lowering crude import taxes and traffic taxes.
In April, the nation's major refineries began a temporary reduction in their oil prices by 100 won per liter, in line with the government's call for help to ease soaring gasoline and diesel prices.
It is worrisome that there are difficulties in buying some oil products at gas stations. Signs reading "sold out" for diesel are easily seen at many gas stations. The refineries suspect oil dealers and gas station owners have stockpiled products in order to gain large profits after the prices are raised, while gas stations claim the refineries do not supply them with sufficient oil products.
The government vows stern measures against production stoppages by refineries and stockpiling by retail sellers.
"We will strictly deal with any irregularities by gas stations," Vice Finance Minister Yim Jong-yong said. "The government will take stern measures, including business suspension or criminal charges, against any unwarranted production stoppages, supply reduction or restraints on shipments and sales (of oil)."
The government will keep an eye on business irregularities in a bid to minimize possible inconveniences among consumers, he added.
The Knowledge Economy Ministry also warned in a statement that it will operate special teams to crack down on irregularities by refineries, oil agents and retail sellers.
Refineries, oil agents and gas stations should make voluntary efforts to establish market order before the government's crack down.
The return to the high oil prices after three months of reduction will likely hit consumers hard both economically and mentally. Consumers have suspected that oil prices did not go down by 100 won per liter as refineries promised. Some consumer organizations claimed the actual price drop was just 60 won. If oil prices go up 100 won per liter next month, the price hike will far surpass the actual reduction three months ago, they insist.
There are also worries of chain reactions that the oil price hike could have on consumer prices. The prices of oil derivatives account for 5.4 percent of consumer prices. Government officials admitted inflation would continue to grow for the time being, which will eventually increase the burden of consumers, especially low- and mid-income people.
So the government, oil refineries and sellers should make concerted efforts in order to soft-land the oil price hike.
Refineries are advised to make gradual price hikes instead of raising the price by 100 won per liter at one time. The government had better consider lowering crude import taxes and traffic taxes.