Hong Kong fuel costs surge 50% since US-Israel war with Iran, government unveils HK$1.8 billion subsidy

Operating costs for Hong Kong's industrial and commercial sectors have jumped 50 per cent since the start of the US-Israel war with Iran, according to an oil industry representative, who has said distributors will pass on subsidies to customers. A taxi union leader on Thursday also called on the government to extend its subsidy on liquefied petroleum gas (LPG) beyond two months if oil prices rose further. The government's subsidy of HK$3 (38 US cents) per litre of diesel to support public and commercial vehicles and vessels took effect on Thursday and would also last for two months. The funds will be directly paid to local oil companies based on sales volume, after lawmakers approved a massive HK$1.8 billion government scheme to ease escalating fuel prices for the transport sector over the next two months. Janet Lo, deputy general manager of Wah Fu Petroleum Company, said oil prices in Hong Kong, which follow the international market, had surged since the war started in February, significantly increasing diesel costs. Local distributors bought diesel from the five major oil companies before reselling it to the industrial and commercial sectors, such as laundry facilities, manufacturers, transport fleets and fishing vessels, she explained.