Gas prices in HK should be determined by market forces
Updated: 2015-12-24 07:51
By Peter Liang(HK Edition)
|
|||||||
The token adjustment to gas prices at the pump when international crude prices are falling fast has touched off a storm of protests from various consumer groups, accusing oil companies of collusion in price fixing.
That is a strong charge because price fixing is now outlawed by the new Competition Ordinance which came into force earlier this month. The oil companies have denied the accusation. But they have failed to produce a reasonable explanation that can help defuse public outrage.
Gas prices in Hong Kong are among the highest in the world because of a stiff government tax introduced - together with high registration fees - with the specific aim of discouraging car ownership. Indeed, the proliferation of private cars, numbering more than 500,000 at the latest count, has been widely blamed for fouling the city's air.
Worsening roadside air quality is unquestionably the biggest environmental concern in Hong Kong. This has led some economic analysts and cartel apologists to contend that oil companies might have done Hong Kong a favor by keeping the decline the price of gas at a much lower rate than that of crude.
That is a preposterous argument which defies any sense of logic. In their words, oil companies, who are never seen as a friend of the environment, have suddenly become its champion.
To be sure, low gas prices could be seen by some people as an incentive to buy the cars they have been dreaming about. But environmental concerns, real or not, should never be used as an excuse for profiteering.
Oil is a commodity whose price level should be determined by the international market. It is the government's prerogative to decide, for environmental or other strategic reasons, to set local gas prices through taxation.
In the case of Hong Kong, keeping gas prices high is widely accepted as a necessity to check the proliferation of private cars that are jamming the roads and polluting the air. If the government deemed that gas prices had dipped too low, as it would if they were adjusted in line with crude, it could raise gas taxes - which would benefit the public coffers instead of lining oil companies' pockets.
(HK Edition 12/24/2015 page7)