Japan mulls subsidy to curb gasoline prices

The Japanese government is considering a subsidy to keep gasoline prices from rising too high. The increase comes on the back of surging prices of crude oil, as countries around the world resume economic activities.

The average retail price for regular gasoline in Japan had gone up to 169 yen, or about 1.50 dollars, per liter as of November 8.

A price above the 170-yen mark would be the highest level in nearly 13 years.

The Industry Ministry is looking at an emergency measure to put a cap on retail gas prices. It plans to give oil distributors a subsidy of up to 5 yen per liter if the average retail price of gasoline exceeds 170 yen. The subsidy would be available from late December until March.

The aim is to prevent oil companies from passing on crude cost increases to wholesale prices. Ministry officials say the purpose of the subsidy would be to keep retail gas prices under control, not to support wholesalers.

The ministry says it will also consider a similar measure for kerosene and diesel fuel.