Fuel prices have risen in China, in line with global trends

Gasoline and diesel are more expensive following market volatility expectations, but supply remains stable

China on Wednesday raised gasoline and diesel selling prices, marking 10e such an increase since the end of last year.

On Tuesday, the National Development and Reform Commission (NDRC), the country’s main economic regulator, said it would increase the price of gasoline by 390 yuan ($ 58.07) per metric ton and the price of diesel would increase by 375 yuan per ton. This means that the retail price is more than 9 yuan per liter for 92# gasoline and even more than 10 yuan for 95# gasoline.

Under the current pricing mechanism, when international crude oil prices change by more than 50 yuan per tonne and remain at that level within 10 working days, the prices of such refined petroleum products of gasoline and diesel in China are in accordance with the adjustment.

Luo Zuoxian, head of intelligence and research at Sinopec’s Economics and Development Research Institute, said the volatile international geopolitical situation further raises expectations of market volatility and rising oil prices. .

Oil prices have remained high internationally in recent weeks. Brent crude futures hit $ 121.17 per barrel on Tuesday, while US West Texas Intermediate crude was at $ 118.93 per barrel.

According to Suhail Al Mazrouei, the energy minister of the United Arab Emirates, which is a major oil producing and exporting country, oil prices are “far from close” to their peak, as Russia’s oil and gas is not completely out of the market and “China is not yet returning” (to the market as a major consumer).

However, if energy supplies from Russia are severely disrupted and China begins to import larger quantities of fuel, then prices could rise to, or even exceed, the all-time maximum. .

Earlier this month, Citi and Barclays, two major global banks, raised their oil price forecasts citing the effects of Russia’s crude oil sanctions and Iran’s renewal delays. nuclear deal, without it there would be no significant increase in crude exported from Iran. .

Luo of Sinopec said he believes the increase in gasoline and diesel prices in China will balance supply and demand because these adjustments will come at the right time.

According to the National Bureau of Statistics (NBS), energy supply is generally stable in China despite the continued rise in energy prices around the world caused by developments in the international situation.

China has intensified their efforts to ensure adequate energy supply. While some of the energy products are more expensive, their price increase is lower compared to the situation outside China, said Fu Linghui, a BNS spokesman.

China has long relied on oil imports. In the past three years, more than 70% of the energy consumed in China has been imported. In 2021, however, for the first time in the past two decades, China’s dependence on crude imports will drop to 72%, from 73.6% in 2020, the Chinese Federation said. of the petroleum and chemical industry.

China’s total crude imports fell last year to 513 million tonnes, down 5.3% year-on-year-and the first decline in 20 years-thanks to the efforts of national energy exploration companies and exploitation of local oil fields recently. years, taught by the federation.

China’s three largest oil companies – China National Petroleum Corp (CNPC), China Petroleum & Chemical Corp (Sinopec), and China National Offshore Oil Corp (CNOOC) – have been told to keep oil production at current levels and facilitate transportation to ensure a stable supply.

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