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A top Japanese oil industry
official warned last week that there could be a shortage of fuel
in Japan if a recently expired tax on the fuel is restored.
The retail price of regular fuel in Japan has fallen 15
percent to its lowest level in nearly a year since the 25.1 yen a
litre (about 25 cents) charge, a "temporary" tax imposed by the
government three decades ago to fund road construction, expired
on March 31 after a political row.
A revival of the fuel tax is likely to trigger a fuel buying
spry in advance of the rise, so steps will need to be taken to ensure
there
are stockpiles to meet essential needs, such as for hospitals and
ambulances, Fumiaki Watari, chairman of the Petroleum Association
of Japan, told local media.
In addition, Petroleum Association of Japan has asked the government to compensate
gasoline stations for losses they have suffered since the tax
expiry, as they have had to slash retail prices in April for fuel
on which they had already paid the surcharge.
The fuel surcharge is levied when oil refiners ship
products from refineries.
Some analysts said Japan's fuel demand, which fell 1.7
percent in 2007 due to the nation's peaking population and a
growing preference for smaller, more fuel-efficient cars, will
get a boost in the business year that started on April 1 if the
gas tax is not restored.
But if the tax is reinstated, that could dent fuel sales
as prices may hit record highs next month, because refiners are
incurring higher crude import costs.
Watari, who also serves as the chairman of Japan's biggest
refiner Nippon Oil Corp, said his company was
shouldering such a cost increase of 2.4 yen per litre so far this
month, which is likely to be passed on to gasoline prices from
May 1.
PetrolWorld 180408
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