Hong Kong authorities will provide a diesel subsidy of HK$3 ($0.38) per liter and halve government tunnel tolls for commercial vehicles to cushion the effect of volatile oil prices.
According to a Hong Kong Special Administrative Region government statement on Thursday, both measures will remain in effect for two months, with an estimated expenditure of HK$1.8 billion and forgoing HK$160 million in tunnel fees.
The ongoing Middle East conflict — sparked by a US-Israel strike on Iran in late February — has propelled global crude prices to levels not seen in years. This market turbulence has hit Hong Kong hard, affecting sectors ranging from aviation and transportation to local fishermen and laundry businesses.
Consumers are also feeling the pinch at the pump, with average retail prices for premium petrol and diesel climbing 16 and 22 percent respectively since the conflict started.
These relief measures were among the four targeted initiatives proposed by a task force in charge of monitoring fuel supply — chaired by the financial secretary — during a meeting with Chief Executive John Lee Ka-chiu on Thursday.
The task force also proposed establishing a dedicated working group to process applications from public transportation operators seeking to adjust their operational strategies amid surging fuel costs, while recommending dynamically calibrating these measures in response to shifting geopolitical developments and global oil prices.
Lee approved all four proposals and ordered their swift implementation.
The SAR government will work with the Legislative Council to fast-track funding approval for the subsidy and liaise with tunnel operators to expedite the toll reductions, the statement added.
Stanley Chiang Chi-wai, chairman of the Hong Kong Land Transport Council, welcomed the government’s support for the sector.
“Since the end of February, the price of diesel had risen by HK$8 per liter, and the proposed subsidy can cover 40 percent of the increase,” Chiang said.
While the measure to halve tunnel tolls fell short of industry calls for a full waiver, it remains a helpful step, Chiang added.
Chow Shui-kan, president of the Hong Kong and Kowloon Fishermen Association, expressed guarded optimism at the relief measures.
He acknowledged that the subsidy provides some support to the community. However, Chow said that the current price for a liter of vessel-use diesel — rising from HK$4.50 to HK$11.50 — remains prohibitively high.
“Even with the subsidy, many fishing vessels remain economically unsustainable,” Chow said. “Many operators may choose to stay in port for a few months to see how the situation unfolds.”
Contact the writer at williamxu@chinadailyhk.com
