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The Russian-Ukrainian conflict has entered its 41st day, and the situation in Russia and Ukraine has undergone subtle changes in the "fight while talking". Relevant information shows that Russia and Ukraine are close to reaching an agreement, but there are still differences on the Crimea issue.
The global impact of the Russian-Ukrainian conflict is gradually becoming more apparent.
In Singapore, the issue of rising gasoline prices was raised in Parliament, with 11 MPs already asking what the government could do to mitigate the impact of oil prices.
With petrol prices still at record highs, motorists in Singapore are feeling the pressure from oil prices. Gasoline prices have fallen over the past week, but are still above $3 a liter.
(Figure: Source from the network)
Fuel Kaki, a fuel retail price comparison website set up by consumer associations, lists the price of Octane 95 gasoline at $3 to $3.05 per liter.
Gasoline prices are pegged to crude oil prices, which remain above $100 (S$136) per barrel. Although Brent crude slipped from $120 a barrel to $104 last week, the same is true.
According to TODAY, the spike in oil prices was widely blamed on the disruption of supplies caused by Russia's war with Ukraine. However, experts agree that this is not the root cause and that the global recovery from the 2019 coronavirus outbreak is the main driver of higher oil prices.
In addition, the COVID-19 pandemic has led to a supply bottleneck due to lower oil prices and less incentive for industry to expand, resulting in insufficient investment in oil production capacity by the Organization of the Petroleum Exporting Countries and its allies (OPEC+).
Selena Ling, director of fiscal research and planning at OCBC Bank, said: "The rise in petrol prices is in tandem with the price of crude oil. The latter reflects the recovery of global economic growth and oil demand, which is exacerbated by the Russian-Ukrainian conflict and OPEC+'s reluctance and inability to raise production in the short term. ”
Strong demand for the recovery has driven oil prices higher, a phenomenon that has occurred before. The last time oil prices reached $100 a barrel came when the economy rebounded after the 2008 global financial crisis.
IRvin Seah, senior economist at DBS, said demand was normalizing to 2013-2014 levels. "What we see today reflects the trajectory of the global recovery and its impact on oil demand."
According to Nomura Holdings, Japan's largest securities firm, for every 10 percent increase in oil prices, Singapore's inflation rate rises by 0.2 percent. A spike in oil prices will have a knock-on effect on the economy as a whole.
Selena Ling said: "End consumers will feel the pressure because this is not only an increase in oil prices, but also a wide range of goods and services, such as food, transportation prices, healthcare and education costs." ”
Song Shengwen, an economist at CIMB Private Bank, added: "From the moment we wake up, the toothpaste we use, to the lights on and transport to work, our demand for these goods and services remains, but the price has gone up. ”
Private car operators recently announced temporary "driver fees" for passengers to help drivers cope with rising pressures on fuel prices and operating costs.
Grab has raised its driver fare by 5 cents, while Texaco Hassco announced that it will temporarily increase its taxi fare from tomorrow (4th), and the fare for every 10 km traveled by Taxi will increase by 3 cents and 2 cents.
Irvin Seah expects inflation in Singapore to remain high at around 4 percent before showing a downward trend at the end of the year.
If wages don't keep up with inflation, the purchasing power of ordinary Malaysians will decrease, but Selena Ling thinks wages could increase back.
"Given that the unemployment rate for residents and citizens has returned to pre-pandemic levels, while the foreign labor policy remains tighter, this could put pressure on wages to increase."
Singapore's finance minister, Wong, said the government would not reduce the pressure on rising cost of living by cutting fuel taxes or offering road tax rebates.
In a ministerial statement in Parliament, Mr. Wong said in response to questions from lawmakers that the government had levied an average of $920 million in fuel taxes over the past five years, which had been used to finance a number of schemes that would benefit Malaysians, including public transportation, and that cutting or suspending fuel taxes or providing road tax rebates would be counterproductive.
Huang said that fewer than four out of every ten households in Singapore own a car, while among the lowest 20 percent of households, only about one in every ten households own a car. Therefore, such allowances for private cars can only benefit a small group of people who are better off economically.
After the minister's statement, a number of lawmakers raised their questions and views, including how the government can next help Malaysians and businesses ease the pressure of rising costs and costs.
Dr Lim Wai Kit, a member of the Sambawang Jik Constituency, asked: "We will wait until the level of inflation reaches before we give more assistance to the people, and what kind of assistance can enterprises and people expect?" ”
Finance Minister Huang Xuncai said: "I can't come up with specific inflation triggers, as I said we are monitoring a series of indicators, not only economic growth, inflation rate, but also unemployment rate and the impact on different groups, different income and occupational groups." ”
Yishun Ji Constituency Councillor Chan Asked: "Will the Minister consider automatically extending the duration of the assistance scheme for beneficiaries so that the beneficiaries, as well as our Civil Service and Social Service Centres, can reduce the administrative burden without having to re-apply, renew or find reasons for the extension." ”
Huang Xuncai said: "The circumstances of different cases are different, and instead of automatically extending the time limit at this stage, we guarantee that those in need will be able to receive assistance." We will simplify the process to make it easier for people to apply without having to submit various documents, which should not be a burden or pressure on them. ”
In response to the high oil prices, several lawmakers also asked the two ministers whether more rebates or assistance measures for Malaysians and enterprises might be offered.
Andy, MP for the Bishan-Great Payoh Jiku Constituency, asked: "I would like to ask the Ministry of Trade and Industry or the Ministry of Finance if they would like to consider a lower electricity price rating, which we are currently working on is more suitable for larger SMEs." ”
Dr. Chen Shilong, Minister of Manpower and Second Minister of Trade and Industry, responded: "If you are saying that you want to develop another level of support, a lower-priced package, then who will subsidize the price difference once the electricity price subsidy is provided, people will use electricity more heavily." ”
Jurong Jip Constituency Councillor Tse Yiu-chun asked: "Diesel supports Singapore's supply chain and the transport of essential goods and services, which is why I asked in Parliament whether it is possible to reduce the tax on diesel-related products." ”
Huang Xuncai said: "Our diesel tax is actually not so high compared with the gasoline tax, which is the first point. The second point is that we have to set tax rates in order to move toward what we call a greener direction and to encourage more people to use energy-efficient modes of transport. ”
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