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Malaysia says no fuel price rises as pressure mounts

Posted: Wednesday, June 11, 2008, 16:03 (BST)
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Demands include a discount of 3-baht ($0.09) per litre of diesel for six months, as well as cheap loans to convert engines to compressed natural gas, he said.

The national air carrier, Thai Airways International, raised its fuel surcharges by up to 100 percent on Wednesday due to the rising cost of jet fuel.

The pressure has also been felt by the Indonesian government, which raised fuel prices by an average of nearly 30 percent last month to try to cut its fuel subsidy bill.

Energy Minister Purnomo Yusgiantoro said the government may drop a plan to introduce rationing of subsidised gasoline for motorcycles and public transport because the scheme is too difficult and expensive to administer.

"There are various reasons, including the cost, which is very expensive," he said.

In South Korea, truck drivers voted to strike on Monday, ignoring a $10.2 billion government aid package designed to cushion the impact of fuel price rises. Producer price inflation in the world's fifth-largest crude oil importer was near a 10-year high last month.

PROBLEMS PILE UP

Problems for governments are also growing in Europe, where Portuguese and Spanish drivers followed their French counterparts by going on strike this week.

Car makers association Anfac said that by Thursday all 18 car factories in Spain would be off line because of a lack of parts and fuel. They produce 18,000 vehicles a day and account for about 5 percent of Spain's gross domestic product.

Some parts of Spain are already suffering fuel shortages after protesters picketed fuel depots and many market stall holders - particularly traders in fruit, vegetables and fish - say they have supplies only for another day or two.

On Tuesday, a striking truck driver was run over by a van and killed in southern Spain and a striker died in Portugal as he tried to stop a truck on a road north of the capital Lisbon.

Retailers in Portugal have said food stocks at supermarkets are beginning to run out, and several petrol stations in Lisbon ran out of petrol on Wednesday. Long queues formed at others.

Dutch truck drivers said they would limit speed to 50 kph (30 mph) on a number of Dutch highways on Thursday to press calls for a diesel excise duty not to be raised. They also want a system to stabilise diesel prices by lowering duties when oil prices rise and raising them when they fall.



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