Petrol prices set to fall below $2 by next month, Latest Singapore News - The New Paper

Petrol prices set to fall below $2 by next month

This article is more than 12 months old

Fuel pump prices are likely to fall in the coming days, although motorists are unlikely to see their bills shrinking by as much as the plunge in crude prices.

According to Bloomberg, a barrel of West Texas Intermediate (WTI) crude was at a record low of -US$0.76 as at 5pm Singapore time, while Brent was at US$22.03 - down from US$24.49 and US$27.39 respectively a month ago, and around US$66 and US$74 a year ago.

Despite that, pump prices here remained stable.

According to Fuel Kaki, a Consumers Association of Singapore (Case) portal which tracks fuel prices, a litre of 92- and 95-octane petrol is listed at $2.05 and $2.09 respectively across all brands. These prices, before discounts, have remained unchanged since March 25.

A litre of 98-octane is listed at between $2.43 and $2.69, while diesel is between $1.69 and $1.72.

Oil industry consultant Ong Eng Tong said pump prices should test the $2 level by next month, with 92-octane falling below $2 - a level not seen since 2016.

"The oil companies have to do something because a slowdown in demand is causing a storage problem," he said. "Otherwise, they will have to start giving it away free."

Mr Jeremy Chua, editor of online motoring magazine Torque, said: "There is no transparency in the pricing of petrol and diesel in Singapore. This is why time and time again, consumers accuse oil companies of collusion and cartel-like behaviour.

"Until transparent pricing is mandated, these accusations will continue."

In a Parliamentary sitting on March 25, Ms Lee Bee Wah (Nee Soon GRC) asked if retail prices at petrol pumps reflected the plunge in crude oil rates, which had fallen sharply in earlier months.

Senior Parliamentary Secretary for Trade and Industry and Foreign Affairs Dr Tan Wu Meng said retail petrol prices here had in fact fallen with the decline in crude oil prices.

"The listed price of octane 95 petrol fell by 20 cents per litre, with a slight lag of six days," he said.

"This represents a pass-through of over three-quarters of the decrease in crude oil price."

Meanwhile, gas and electricity tariffs have not changed significantly from a year ago. According to the Energy Market Authority (EMA), the general gas tariff for the April-June period is 17.11 cents per kWh, down from 17.23 cents in the Jan-March period, and 18.8 cents in April-June 2019.

Domestic electricity is 24.62 cents per kWh for April, down from 25.94 cents in January. It was 24.39 cents last April.

An EMA spokesman said electricity and gas tariffs for each quarter are derived from average gas prices (indexed to oil prices) in the preceding two and a half months, causing a lag in changes.