Hong Kong Government Announces Temporary Measures to Ease Diesel Cost Burden Amid High Oil Prices

The government announced on the evening of April 9 four temporary relief measures to ease the burden of high diesel prices on businesses and the public, following a special meeting chaired by Chief Executive John Lee Ka-chiu.

The main measure is a two-month subsidy of HK$3 per litre on diesel for commercial vehicles and vessels, including goods vehicles, franchised and non-franchised buses, minibuses, ferries, passenger boats, working boats and fishing vessels. The subsidy, expected to cost about HK$18 billion, aims to lower operating costs and reduce pressure on fare increases. Private cars and motorcycles are excluded.

In addition, all government tolled tunnels will offer a 50% discount on fees for commercial vehicles, including goods vehicles, buses, minibuses and taxis, for two months. Private cars and motorcycles are not eligible. The concession is estimated to cost the government about HK$1.6 billion in revenue.

The government will also set up a special task force to speed up the processing of applications from public transport operators, such as bus and ferry companies, to help them cope with rising fuel costs while maintaining service stability and considering passengers’ affordability.

Authorities will continue to closely monitor the Middle East situation and oil price movements, and will adjust measures as needed.

The measures were drawn up after tensions in the Middle East pushed international crude prices close to US$120 per barrel. Although crude prices have eased slightly, local diesel prices remain high. Hong Kong’s fuel supply remains stable, with about 80% of petroleum products coming from the Mainland.

The diesel subsidy requires approval from the Legislative Council Finance Committee. LegCo President Rita Fan has scheduled a special meeting for tomorrow afternoon (April 10) to examine the urgent funding request. Chief Executive John Lee has instructed departments to implement the measures as soon as possible.