TOKYO: The average retail price of regular gasoline in Japan as of Monday fell 1.7 yen from a week before to 184.8 yen per liter, down for the first time in 18 weeks, thanks to the government’s expanded subsidy program, the industry ministry said Wednesday.

The decline came after the national average rewrote a record high for the second consecutive week.

The program to expand subsidies to curb soaring retail prices in stages took effect Thursday. Aiming to push down pump prices to around 175 yen by the end of October, the government will enhance the aid for oil wholesalers again on Oct. 5.

In the reporting week, the average price fell in 41 of the country’s 47 prefectures. But it stayed flat in Saga and went up in Kochi, Nagasaki, Oita, Miyazaki and Okinawa, due to a time lag in reflecting the expanded subsidy program into retail gasoline prices, depending on gasoline inventories at service stations, the ministry said.

The highest price was 192.5 yen in Nagasaki, while the lowest was 179.7 yen in Iwate.

Retail prices are to decline once inventories that do not reflect the expanded subsidies are gone, according to an official at the Oil Information Center of the Institute of Energy Economics, which conducts the weekly price survey on behalf of the ministry.

Estimating that the national average would have reached 197.3 yen as of Monday unless the subsidies were provided, the ministry plans to pay wholesalers 26.1 yen per liter from Thursday, up 8.7 yen from a week earlier.

The government had planned to scrap the subsidy program at the end of this month after reducing the aid amount in stages. But pump prices rose from June, when the subsidies began to shrink.

In view of the national average rising past 180 yen to levels unseen in 15 years in August and later due to the yen’s depreciation and higher crude oil prices, the government decided to extend the program until the end of this year and increase the subsidy amount.

JIJI Press