Fuel crisis is externally driven, not a government failure: MP Prasad

The former Deputy Prime Minister and Minister for Finance Biman Prasad has urged Fijians to brace for further fuel price increases, saying the crisis gripping the country is not of Government's making and must be treated as a national emergency.

Speaking at a media conference in Suva yesterday, Mr Prasad said the spike, which saw diesel jump by 75 cents and kerosene by 71 cents from yesterday, was driven entirely by global forces, particularly the ongoing conflict in the Middle East disrupting oil supply through the Strait of Hormuz, a key shipping route for about 20 per cent of the world's oil.

"This is a crisis that is external, externally driven. It is not created by Fiji or government or some business entities or individuals," he said.

Mr Prasad said the priority must be protecting fuel supply and the people most dependent on it, farmers, fishermen, bus companies and businesses, to prevent job losses.

He said reducing fuel taxes, which include 20 cents per litre on diesel and 46 cents on unleaded petrol, was an option but warned the government should hold that measure back for now.

"If we remove fuel tax of 20 cents on diesel and 46 cents on unleaded petrol, you immediately lose about $150 million," he said, adding that any relief should instead be targeted at the most vulnerable.

He said Government should also consider cutting operational spending such as travel, conferences and workshops, and delay non-urgent capital projects to redirect funds toward affected households and businesses.

Prof Prasad also called on Australia to provide budget support, saying the security treaty being negotiated between the two countries was an opportunity to secure broader economic assistance during the crisis.

His message to families was clear, prices will rise, but losing a job on top of that would be a "double tragedy".

"As long as people maintain their jobs, even if there is a price increase, those above certain levels of income can still manage," he said.