Hong Kong’s dominant bus operators warned Friday that a dramatic surge in refined oil prices triggered by the conflict in the Middle East has placed “unprecedented” financial strain on the city’s public transport network.
In a rare joint statement, Kowloon Motor Bus (KMB) and Citybus revealed that the cost of refined oil has nearly tripled since late February. While global crude oil prices have climbed approximately 60%, the cost of the refined fuel used to power their fleets has skyrocketed from an average of US$90 per barrel to more than US$200, reaching a peak of US$255.
The sharp increase has upended the industry’s traditional cost structures. Before the outbreak of the war, fuel expenses typically accounted for 10% to 15% of fare revenue. That figure has now doubled to roughly 30%, according to the companies.
“Franchised bus operations have always operated on thin profit margins,” the statement read. “The surge in refined oil prices has caused a severe imbalance between revenue and expenditure.”
