Fuel prices in China increased again

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Last updated at: (Beijing Time) Monday, December 08, 2003

Fuel prices in China increased again

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Shanghai gas stations raised the basic retail prices of diesel and gasoline by more than 5 percent on Saturday following the central government's decision to increase refined oil prices nationwide. Industry insiders blamed the price rise to soaring international crude oil prices.

Prices of three types of gasoline and two types of diesel were raised in some 700 local gas stations. The basic price of No 90 gasoline used mostly by sedans is 2.98 yuan (35.90 US cents) a liter, compared with the former price of 2.82 yuan a liter.

The basic price of No 0 diesel, which was out of supply in some areas of Shanghai during the middle of last month, is 3.06 yuan a liter, up 5.5 percent. Many out-of-town buses and trucks were refueled in Shanghai as gas suppliers had raised prices in Zhejiang and Jiangsu provinces.

The chinese-language Beijing Youth Daily also said yesterday that Beijing gas stations raised their diesel and gasoline prices following a Saturday notice from the National Development and Reform Commission, which is responsible for the pricing of some strategic commodities.

In both cities, gas stations can sell diesel and gasoline 8 percent higher or lower than the basic prices.

"The proportion of the price hike in Shanghai this time is relatively large," said an executive, surnamed Xue, with Sinopec Shanghai Oil Products Co.

"The refined oil prices are set by the central government and as a distributor, we will carry out the decision."

Sinopec shanghai Oil Products Co is the main distributor of China Petroleum and Chemical Corp, the country's largest refiner, in Shanghai and it owns 547 gas stations in the city. The company received the order to raise prices early on Saturday morning.

The local gas station operators have been waiting for this news for at least a month, Xue said.

This is the third time that the central government has adjusted the retail gasoline and diesel prices. In January, it raised prices due to surging international oil price caused by pending Iraq war.

The government lowered price in May to boost spending to offset the negative impact of the outbreak of severe acute respiratory syndrome.

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