00:00Exactly what is driving fuel price hikes?
00:03The price of 95 Octane, the most popular grade of fuel, has jumped by about 20%.
00:08At the time that we're recording this,
00:10chopping up a 50-litre tank at Caltex, Esso, Shell or Sinopec
00:13will cost you about $30 more now before this comes.
00:17But why?
00:18First, some context on petrol prices.
00:20Despite what some people think, petrol prices are not controlled by the government.
00:24They are fully decided by the operators.
00:26And the operators decide the prices every single day.
00:29They draw on something called Meen of Plaid, Singapore,
00:32which is a set of industry price assessments that are not made public.
00:35The cost of crude oil is currently impacted by the conflict in the Middle East,
00:39a major producer of oil.
00:41And a significant portion of the oil going to Asia is transported through the Strait of Hormuz,
00:45which is effectively closed because of the war.
00:48Major petrol station operators responded to this supply disruption by raising prices on March 3rd.
00:53But you will notice that the prices were raised three days after the war began.
00:57This has led to comments like this.
01:02But petrol pricing can also be affected by many other factors.
01:06Inventory levels, storage and transportation costs, currency exchange rates,
01:10and competitive market forces are some of the examples operators have shared.
01:14Still, President of case Melvin Yong said that petrol companies in Singapore should practice greater price transparency.
01:20He pointed out that when international oil prices went up, local petrol operators' prices also went up.
01:26But when global prices went down, local ones didn't.
01:29If this entire situation continues, it could be some miles before prices start to ease.
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