Commission expects fuel prices to fall

By CLARISSA MOI
THE decline in global crude oil prices is expected to drive down prices for petrol, diesel and kerosene in the country over the next few months, according to Independent Consumer and Competition Commission.
Commissioner and chief executive Paulus Ain said Papua New Guinea was not a major producer for crude oil, hence, the country’s price was determined by supply and demand in the world market by the biggest producers and consumers of oil.
Ain said the world market price would affect PNG in the sense that it would lower price the country was able to get for crude oil in the world market.
He was responding to questions from The National on whether the impact of the coronavirus and the price war between Russia and Saudi Arabia would have an impact on the country’s oil prices.
“Should the demand for oil by China continue to remain subdued due to the coronavirus, the world market price for oil will continue to remain low due to excess supply in the market,” he said.
Ain said if the coronavirus was not contained in the near future, it could trigger a worldwide recession.
“A recession will drive down all commodity prices, hence, affect Government revenue,” he said.
“The threat of a recession is visible given the adverse impact on the various stock markets around the world over the past month.
“However, the decline in crude oil prices will most likely continue to drive down the prices for petrol, diesel and kerosene over the next few months as long as the price for crude oil continue to remains low.”
Meanwhile, Saudi Arabia and Russia have not agree on production cuts yet.