In terms of bang for buck, oil shock meaningless for HK

And so oil at US$100 a barrel is almost upon us, is it? That's as good a reason as any to send markets down when they are already in a downish mood. Bring on the doom and gloom.

But just one moment first. Perhaps we may want to think of one or two trends that could take some of the gloom off the doom, particularly for Hong Kong.

Look at the first chart below. It shows you a 12-month rolling average of the value of net mineral fuel imports relative to gross domestic product.

I shall mention the caveats to this chart before you do. 1) Mineral fuels include coal and we're talking about oil, not coal. 2) A sizeable proportion of our petroleum product imports comes in the form of jet fuel and bunker fuel. These leave Hong Kong again through the airport and the container port and we cannot really call them retained imports. 3) A 12-month rolling average does not take full account of how oil prices have spiked since mid-summer.

All true, but, 1) the figures indicate that by value, coal accounts for only a small proportion of the total mineral fuel import bill; 2) try imagine our economy without an airport or seaport; and 3) your cost of petrol at the pump has also never gone up and down quite so sharply as the spot price of crude oil.

Right, that's the caveats dispensed with. Now look at the chart again. What matters is that even as of last month, our net cost of mineral fuel imports was still less than 5 per cent of GDP. That may sting but it doesn't injure.

And look how high that figure was at the beginning of 1982, almost 6.5 per cent. I wish I had data on the net value of Hong Kong's fuel imports earlier than 1980 or better yet, earlier than 1973, but I don't. If anyone can find these figures, please send them to me.