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Fuel hike protests spread worldwide

Latest update : 2008-06-22

Protests over fuel hikes are continuing across the world. On Thursday, Chinese motorists became the latest victims of rising oil prices, as the government announced an increase in fuel prices, which had been stable for six months. (Report: Y.Royer)

Spanish farmers marched, Israeli truckers slowed rush-hour traffic and Nepali students stoned cars on Thursday, all angry at rising fuel prices and inflation that they say are crippling their economies.

Protests by truckers, taxi drivers, fishermen and farmers demanding fuel-tax breaks have spread across the world, increasing fears of political instability and a global economic downturn.

The oil price, which dipped $3 to $133 on news that China will raise retail gasoline and diesel prices from Friday, has touched record highs near $140 in recent months, fuelling inflation and squeezing business margins.

In Madrid, thousands of farmers brought traffic to a halt on the capital's busiest road to demand lower diesel tax to help cushion the blow of higher fuel costs and low producer prices.

"This is the last straw. If good spring rain hadn't arrived this year and last, we would already have gone bust," said sugarbeet farmer Evaristo Ortega. "The price of diesel and fertiliser is impossible to bear."

Diesel prices have shot up to around 1 euro ($1.56), from 60 cents a year ago, farmers said as they marched past soccer club Real Madrid's Bernabeu Stadium carrying banners reading: "For the future of our countryside".

In the United States, government data showed people drove less in April for the sixth month in a row, following record gasoline prices as more people used public transport.

In Greece, the cost of living has replaced unemployment as the top concern, unions said. Food prices have risen and motorists pay 13 percent more for fuel than a year ago and heating oil costs 38 percent more.

About 2,000 Greeks protested against sharp increases in prices and demanded action from the conservative government.

Protesters in central Athens chanted slogans such as "Enough with poverty and unemployment" and held banners reading "We're the European champions of profiteering".

"I don't have enough money to pay the rent and shop for food," said pensioner Katerina Nanou, 67. "We want real measures against high prices, this government is mocking us."

But Germany and other European Union states said they would reject a fuel tax break plan sought by France to cushion rising oil prices.

A senior French official said President Nicolas Sarkozy would ask EU peers to back a reduction in value-added tax on petrol across the 27-nation bloc.

In Berlin, German Chancellor Angela Merkel told parliament: "In our view, financial policy intervention, which is being discussed again and again ... should be avoided."

Swedish Prime Minister Fredrik Reinfeldt went further and told reporters that Europeans should work longer hours and pay less income tax to cope with rising prices.

"I am asking myself ... that we might ease up on income taxes to make work pay even further, so that people could react to the fact that an increase in the petrol price could be met by working some extra hours," Reinfeldt said.


In the Middle East, Israeli truck drivers, supported by taxis and buses from across the country, intentionally slowed down traffic on Tel Aviv's Ayalon Highway during rush hour to demand that the Treasury remove tax charged over diesel fuel.

Scuffles erupted when police attempted to disperse the protest. One driver was injured and several detained.

But Treasury officials said they had no intention of changing current tax policy.

Asia has also been hit by protests and demonstrations from trade unions and students over climbing prices.

But more increases in the region seemed to be on the way. Two industry sources said China would announce a surprise increase of about 18 percent in retail gasoline and diesel prices effective from Friday, the first rise in eight months.

The sources said gasoline and diesel prices would rise by 1,000 yuan ($145.5) per tonne.

Elsewhere, governments were moving to ease fears.

Thai transport groups government said a meeting with finance, transport and energy officials had yielded positive results over ways to help ease the rising fuel bill.

"We are satisfied with the outcome of today's meeting as most of our demands were met," said Yoo Chienyuenyongpong, head of the Land Transport Federation of Thailand, which has 400,000 trucks under its banner. "But we have to keep the blockade condition for now until the government actually delivers."

But in Nepal, hundreds of activists stoned or set fire to several vehicles in the capital Kathmandu to demand a 50 percent discount in transport fares to students, from 33 percent now.

State-run Nepal Oil Corporation increased petrol and diesel prices by about 25 percent last week. Transport operators also raised fares between 25 and 35 percent for taxis and buses.

"The street has turned into a battlefield with protesters throwing stones at the riot police," said Deepak Rijal, a local journalist at one protest site.

Date created : 2008-06-20