Taiwan’s state-run oil refiner, CPC Corporation, says that falling oil prices may lead to more losses for the company.
On Thursday, the West Texas Intermediate crude oil spot price and Dubai crude oil both fell below US$50 a barrel, and Brent crude oil fluctuated around the level of US$50 a barrel. It is expected that petrol and diesel prices in Taiwan will continue to drop as a result.
CPC vice president Chang Ray-chung said on Friday that the company has accumulated losses of NT$99 billion (about US$3 billion). He also said that the company only has a capitalization of around NT$130 billion, so continued low oil prices may affect the company’s operations.
"We used to say that our pre-tax oil price was cheaper than water, now our after-tax price is cheaper than water too," said Chang.
"You see, we transport the oil all the way from Saudi Arabia to Taiwan, and the oil goes through a complex refining process before it reaches petrol stations. But now petrol is even cheaper than mineral water," he said.
Chang said that despite its difficult financial situation, the company will not cut corners on necessary maintenance. But he also said the company hopes the government will allow the market to decide petrol prices.