Cheaper fuel at pumps from today
By Ding Yining |
May 10, 2012, Thursday
|
Print Edition
Print Edition
China has cut fuel prices for the first time in more than six months after global crude prices fell. The price cuts follow two increases this year.
The ceiling retail price for gasoline and diesel will be cut by an average of 330 yuan (US$52.3) and 310 yuan per ton respectively, the National Development and Reform Commission said on its website yesterday.
At Shanghai pumps, from today, 93-octane gasoline will cost 8.01 yuan a liter, down from 8.27 yuan; and zero-grade diesel is now 7.92 yuan a liter, down from 8.19 yuan.
China introduced a new fuel pricing mechanism in 2009, allowing the NDRC to adjust fuel prices when the moving average of a basket of international crudes changes more than 4 percent over 22 working days.
The moving average of the basket, comprised of prices at Brent, Dubai and Cinta, has dropped 4.01 percent since March 20.
"International crude prices have been on the rise for the past few years and it is almost inevitable for domestic gasoline prices to climb higher rather than drop," the NDRC said. "Domestic gasoline price is linked to the international price in a controllable and indirect way."
Since the scheme was introduced in 2009, gasoline prices have been raised 12 times but cut just five times.
The NDRC's decision to cut prices was swift this time. Previously, consumers complained it was too slow to cut prices, compared to its speed in raising them once the 4 percent threshold was triggered.
"The price cut is within expectation and the retail market has been sluggish for one to two weeks," Shanghai-based energy and commodity researcher C1 Energy said yesterday.
"I hope the range of the price cut could be as big as price lifts in previous months," said Sherry Yao, an employee with a consultancy firm. "Otherwise in the long run, the fuel price is still climbing and eventually car owners like me will have to pay more."
"The international crude price is expected to drop further and if the NDRC cuts the domestic price later this week or next week, it will be between 400 to 500 yuan per ton," said Liu Feng, an energy analyst with SCI99, a commodity consultancy.
"The NDRC's quick response this time is to link domestic fuel prices more closely with the international level and also to ensure profits for state-owned oil companies refining business."
On seeing the drop in global crude prices, some gas stations in Shanghai have been cutting prices to attract consumers over the past two weeks.
Several filling stations, most of them privately owned rather than under the umbrella of state-owned Sinopec or PetroChina, have been selling 93-octane gasoline at 7.7 yuan to 7.9 yuan a liter.
The last adjustment took place in late March, when the NDRC increased gasoline and diesel prices by 600 yuan.
That sent Shanghai's fuel prices to a record high, the first time they had hit 8 yuan a liter. Consumers complained about entering the "8 era" of prices.
The ceiling retail price for gasoline and diesel will be cut by an average of 330 yuan (US$52.3) and 310 yuan per ton respectively, the National Development and Reform Commission said on its website yesterday.
At Shanghai pumps, from today, 93-octane gasoline will cost 8.01 yuan a liter, down from 8.27 yuan; and zero-grade diesel is now 7.92 yuan a liter, down from 8.19 yuan.
China introduced a new fuel pricing mechanism in 2009, allowing the NDRC to adjust fuel prices when the moving average of a basket of international crudes changes more than 4 percent over 22 working days.
The moving average of the basket, comprised of prices at Brent, Dubai and Cinta, has dropped 4.01 percent since March 20.
"International crude prices have been on the rise for the past few years and it is almost inevitable for domestic gasoline prices to climb higher rather than drop," the NDRC said. "Domestic gasoline price is linked to the international price in a controllable and indirect way."
Since the scheme was introduced in 2009, gasoline prices have been raised 12 times but cut just five times.
The NDRC's decision to cut prices was swift this time. Previously, consumers complained it was too slow to cut prices, compared to its speed in raising them once the 4 percent threshold was triggered.
"The price cut is within expectation and the retail market has been sluggish for one to two weeks," Shanghai-based energy and commodity researcher C1 Energy said yesterday.
"I hope the range of the price cut could be as big as price lifts in previous months," said Sherry Yao, an employee with a consultancy firm. "Otherwise in the long run, the fuel price is still climbing and eventually car owners like me will have to pay more."
"The international crude price is expected to drop further and if the NDRC cuts the domestic price later this week or next week, it will be between 400 to 500 yuan per ton," said Liu Feng, an energy analyst with SCI99, a commodity consultancy.
"The NDRC's quick response this time is to link domestic fuel prices more closely with the international level and also to ensure profits for state-owned oil companies refining business."
On seeing the drop in global crude prices, some gas stations in Shanghai have been cutting prices to attract consumers over the past two weeks.
Several filling stations, most of them privately owned rather than under the umbrella of state-owned Sinopec or PetroChina, have been selling 93-octane gasoline at 7.7 yuan to 7.9 yuan a liter.
The last adjustment took place in late March, when the NDRC increased gasoline and diesel prices by 600 yuan.
That sent Shanghai's fuel prices to a record high, the first time they had hit 8 yuan a liter. Consumers complained about entering the "8 era" of prices.
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