About 2 weeks ago, taxi companies came together to lobby for a 30 cents fuel surcharge in light of raising diesel prices. Ironically, on the first day that the surcharge was implemented, diesel price dropped, but still remained about $2 per litre. Since then prices dropped 2 more times which returned the price of diesel to sub-$2 again at $1.993 per litre. This is a result of a drop in crude oil prices, which is now trading at US$128.88 a barrel.

Now that diesel prices are going down, are the taxi companies going to scrape the 30 cents surcharge? Or is it here to stay? If it is, then this effectively means that there is now a flag-down rate of $3.10, up from the normal taxi rates of $2.80 but masqueraded as a fuel surcharge. I wonder how long the taxi companies will want to keep the surcharge, or will they just openly get it absorbed into the flag-down rate eventually.

Pump prices fall again – third time in fortnight

By Christopher Tan

PUMP prices fell for the third time in a fortnight, led again by Shell on Monday.

The reductions were two cents a litre for diesel and four cents for petrol, except for so-called ultra-premium petrols, which fell by three cents.

The latest adjustment brings a litre of 92-octane petrol to $2.133 a litre before discount; 95-octane to $2.166; and 98-octane to $2.24.

Shell’s V-Power is now $2.369, while Caltex’s Platinum is $2.366.

Diesel returned to sub-$2 level to $1.993.

The slide follows a sustained drop in international crude oil prices. Light, sweet crude for August delivery ended last week at US$128.88 a barrel on the New York Mercantile Exchange.

A week earlier, it hit a record US$147.27.

Source: Straits Times Interactive, http://www.straitstimes.com/Latest%2BNews/Singapore/STIStory_259923.html

Article extracted on 21st July 2008

Reader's Comments

  1. Paddy Tan | July 22nd, 2008 at 1:16 am

    I doubt they will change it so fast. Most likely will give the standard FAQ that they will monitor it (and perhaps hopefully .. it will be forgotten).

    Here in Singapore, the public transportation guys are quick to increase but slow (or never) to decrease. It depends on who is defining on the market forces and the demand.

  2. Jwong | July 22nd, 2008 at 10:22 am

    Yes the prices have gone down, but you will have to suffer the surcharge a little while longer. They have faced increasing diesel prices for quite awhile now, holding out only to implement it after suffering losses, hungry stomachs and increased profi, ahem, prices.

    Besides, it is a surcharge to buffer the fluctuations of the prices of diesel, starting at $0.30. This will then be adjusted upwards whenever the prices of diesel increased. Someone in the cartel found this was something they could charge you for, but overlooked for a long long time. Now they have wised up to the fact that separate fees mean more profi, ahem, flexibility.

    Tomorrow, baggage surcharge, aircon surcharge, engine oil surcharge, car insurance surcharge, coe surcharge… All increasing costs, you know? Then they might think of imposing rice surcharge, coffee surcharge and 20 cents toilet surcharge – because drivers need to eat, drink and go to the toilet too.

  3. tanyeo | July 23rd, 2008 at 12:56 pm

    neber mind,, i dun take taxi!!!!

  4. diesel additive | July 24th, 2008 at 10:58 pm

    Paddy Tan – I think that the idea of quickly increasing but slow to decrease is a trend world wide, not just in Singapore!

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