Fuel price protests spread in India, Malaysia
Saturday, 7 June 2008
KOLKATA, June 6 (Agencies): Protests and strikes over fuel price rises spread across India Friday despite moves to take the sting out of the hikes, while anger fizzled out in Malaysia as the government stood firm after larger increases.
The governments of the fast-growing Asian nations were the latest to raise subsidised fuel prices this week, following similar moves in Indonesia, Taiwan and Sri Lanka.
Global oil soared by more than $6 a barrel to over $134 Friday, bringing gains in the last two days to $12 as the dollar weakened further on a jump in the jobless rate in the United States.
Global crude oil rose for a second day as demand grew for a hedge against a weakening dollar and Morgan Stanley said prices may reach $150 within a month because of accelerating Asian consumption amid declining inventories.
The bank, one of Wall Street's two biggest energy traders, expects a ``spike'' in oil because ``Asia is taking an unprecedented share'' of Middle East exports, wrote analyst Ole Slorer.
Investors hedging against the dollar's 6.5 per cent drop this year have spurred oil, gold and corn to records.
``One-hundred and fifty as a target is not unrealistic,'' said Gerrit Zambo, an oil trader for BayernLB in Munich. ``Another $15 on top of the record could be the matter of a week. It's mainly driven by financial players as the euro gets stronger again.''
Both the governments(India and Malaysia) had delayed the decision until now after electoral setbacks, and amid concerns about rising inflation, but in India the strikes, called by communists and opposition parties, seemed as unpopular as the price rises.
India increased petrol and diesel prices by around 10 per cent, passing on just a fraction of the higher costs its oil companies are paying, and then, with elections looming, tried to cushion the blow by challenging state governments to cut their excise duties and sales taxes.
Several states have announced duty cuts of between around two and five percentage points, while others are expected to follow suit, moves that will come at the expense of their own budgets and of efforts to curb demand for fuel.
Nevertheless, strikes and protests at the fuel price hike -- called by opposition parties and the government's own communist allies -- spread around the country.
Transport was paralysed in the large states of Andhra Pradesh and West Bengal, as well as parts of Orissa, as mobs of opposition supporters besieged bus stations, sat on rail tracks and pulled people out of taxis.
Many businesses, including software firms, were closed in Kolkata and Hyderabad, a city competing with Bangalore to be India's Silicon Valley.
The problems facing the government less than a year before elections were underlined on Friday with news inflation rose to a fresh 3-
The governments of the fast-growing Asian nations were the latest to raise subsidised fuel prices this week, following similar moves in Indonesia, Taiwan and Sri Lanka.
Global oil soared by more than $6 a barrel to over $134 Friday, bringing gains in the last two days to $12 as the dollar weakened further on a jump in the jobless rate in the United States.
Global crude oil rose for a second day as demand grew for a hedge against a weakening dollar and Morgan Stanley said prices may reach $150 within a month because of accelerating Asian consumption amid declining inventories.
The bank, one of Wall Street's two biggest energy traders, expects a ``spike'' in oil because ``Asia is taking an unprecedented share'' of Middle East exports, wrote analyst Ole Slorer.
Investors hedging against the dollar's 6.5 per cent drop this year have spurred oil, gold and corn to records.
``One-hundred and fifty as a target is not unrealistic,'' said Gerrit Zambo, an oil trader for BayernLB in Munich. ``Another $15 on top of the record could be the matter of a week. It's mainly driven by financial players as the euro gets stronger again.''
Both the governments(India and Malaysia) had delayed the decision until now after electoral setbacks, and amid concerns about rising inflation, but in India the strikes, called by communists and opposition parties, seemed as unpopular as the price rises.
India increased petrol and diesel prices by around 10 per cent, passing on just a fraction of the higher costs its oil companies are paying, and then, with elections looming, tried to cushion the blow by challenging state governments to cut their excise duties and sales taxes.
Several states have announced duty cuts of between around two and five percentage points, while others are expected to follow suit, moves that will come at the expense of their own budgets and of efforts to curb demand for fuel.
Nevertheless, strikes and protests at the fuel price hike -- called by opposition parties and the government's own communist allies -- spread around the country.
Transport was paralysed in the large states of Andhra Pradesh and West Bengal, as well as parts of Orissa, as mobs of opposition supporters besieged bus stations, sat on rail tracks and pulled people out of taxis.
Many businesses, including software firms, were closed in Kolkata and Hyderabad, a city competing with Bangalore to be India's Silicon Valley.
The problems facing the government less than a year before elections were underlined on Friday with news inflation rose to a fresh 3-