Chairwoman of antitrust body believes infrastructure constraints creating ‘very nasty problems’ for buyers
The Hong Kong government needs “political will” to drive change and foster competition, the chiefs of the city’s antitrust watchdog have said, a week after officials dismissed the outfit’s advice on liberalising the motor fuel market.
“[The] competitive market is not just the private sector. It has got to be backed up and supported by government policies, and they’ve got to look at these areas to see how far they are willing to go for a change,” Competition Commission chairwoman Anna Wu Hung-yuk told the Post.
The government on July 17 rejected a commission suggestion that longer-term structural reform of the petrol market be launched, saying “the costs could outweigh the benefits”.
But Wu countered: “Infrastructure constraints are creating very nasty problems for consumers.”
Officials also declined to reintroduce a petrol product formerly offered in the city, claiming the extra operating and capital expenses incurred might not yield cheaper choices.
The commission’s CEO, Brent Snyder, expressed disappointment with the government’s decisions.
“It really goes back to the issue of political will in the sense that there can’t be any change to the status quo without addressing the long-term storage and capacity issue,” he said.
One of the watchdog’s suggestions was to require oil companies share their existing terminal facilities with third parties. But Environment Bureau officials said such a mechanism would raise complex questions about quality and liability.
Fuel prices have been notoriously high in Hong Kong, where there are 180 filling stations operated by six petrol companies: ExxonMobil, Shell, Caltex, Sinopec, PetroChina and Feoso. Recent data compiled by GlobalPetrolPrices.com suggested the city ranked second most expensive in the world for gasoline, charging US$2.10, or HK$16.48, per litre.
RON is an octane rating number, measuring how easily the fuel will ignite inside an engine.
“We cannot change the law quickly,” Wu said.
