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Asia to cut subsidies as oil hits $135

Asian governments on Thursday moved to cut energy subsidies to protect their finances and those of state-owned energy companies in the face of soaring oil prices.

As crude oil pushed through $135 a barrel for the first time, Taiwan, Malaysia and Indonesia announced plans for urgent action to free prices or cut subsidy costs. China denied rumours of an imminent increase in retail prices, but may relax price controls.

Now that would be a major, major policy change. A welcome one, but a momentous one, with lots of potentially nasty politicla consequences.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Thu May 22nd, 2008 at 03:53:36 PM EST

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