Image source: https://www.tohokukanko.jp/
Regular gasoline prices in Miyagi Prefecture this week have fallen for the second consecutive week, reflecting government subsidies. With no clear outlook on the situation in the Middle East, bus companies are expressing concerns about the future.
Reporter Yuri Ito: “That gas station along National Route 4 is selling regular gasoline for 155 yen per liter. Another gas station is selling it for 153 yen per liter.” According to the Petroleum Information Center, as of March 30 (this Monday), the average retail price of gasoline in Miyagi Prefecture was 164 yen 40 sen for regular and 175 yen 50 sen for premium, a decrease of about 6 to 7 yen from the previous week.
This is the second consecutive week of price decreases, and it is said that “the impact of government subsidies, which resumed on March 19, is being reflected in the prices.” Although gasoline prices have stabilized in the short term, concerns are spreading among public transportation users.
Reporter Yuri Ito: “Diesel fuel is used as fuel for buses, which are used by many people for commuting to work and school. Diesel fuel is also being seriously affected.”
Miyagi Kotsu operates approximately 600 vehicles daily, mainly route buses, but also charter buses and express buses.
Takao Chida, General Manager of Sales at Miyagi Kotsu: “We have heard that the government’s reserves of petroleum will last for eight months, so that means we won’t have enough until the end of the year. Without some kind of policy, we are concerned that it will be unclear what will happen after the summer.”
Miyagi Kotsu consumes about 7.2 million liters of diesel fuel annually, and if the price rises by 50 yen per liter, it will increase their annual burden by 300 to 400 million yen. Currently, they are not considering reducing the number of services or changing fares, but with the situation in the Middle East remaining uncertain, they are worried about how long they will be able to procure fuel.
Takao Chida, General Manager of Sales at Miyagi Kotsu, said, “The most troubling thing is that we can’t see what the future holds. As long as the supply (of fuel) continues, our top priority is to keep operating in order to protect the transportation needs of our users. To that end, we are gathering information as quickly as possible from the national, prefectural, and municipal governments, as well as from sales companies, so that we can prepare to take the next steps.”
Amidst this situation, the Sendai City Bus, which operates approximately 450 buses daily, is already beginning to feel the effects. The Sendai City Transportation Bureau procures diesel fuel, which it uses at a rate of about 6.9 million liters annually, through four bidding processes per year. However, the March bidding was unsuccessful because the bid price exceeded the planned price. As a result, for the April supply of diesel fuel, they had no choice but to switch to a negotiated contract with a specific supplier and procure it from the supplier at approximately 1.7 times the current price. With high crude oil prices potentially having a devastating impact on public transportation, what are people saying?
User (commuter): “I already thought public transportation was expensive, so if it goes up any further, I feel like getting around will become a little inconvenient.” User (frequent user): “It’s strange to say it’s unavoidable because of the current global situation, but I’m sure the people at the transportation bureau are worried, even though there’s nothing they can do personally.” Sendai City Bus has been operating at a loss for five consecutive years until fiscal year 2024, and there are concerns about the impact of the current rise in crude oil prices on its operations
