Soaring crude oil prices will have impact on both world and Chinese economies, but that on the latter seems quite limited presently, said Zheng Jingping, spokesman of the National Bureau of Statistics at a press conference held by the Information Office of the State Council on October 22.

Crude oil is indeed a global concern, said Zheng, adding that in the first nine months of this year, China exported 4.3 million tons of crude oil valued at $1 billion and imported 90 million tons with a value of $23.6 billion.

Estimates have shown that if the oil price is up $10 a barrel and the hike lasts one year, China's consumer price index would grow 0.3 to 0.4 percentage points, he said.

China imports a certain amount of oil, but it is also an oil producer, with an annual output of 170 million tons.

Zheng noted there is only minor possibility of a continuous rise of oil prices based on current levels, but China should pay close attention to and make some precautious preparations for the price trends.

Many factors contribute to the oil price hike this time, Zheng said, including political turbulence, natural disaster, the Yukos incident and changes in world oil demand-supply relations.

Besides, speculation is also a cause. Practice in both oil crises in history and the development of the world economy's dependence on crude oil showed that continuous oil price hikes will hurt both producers and consumers, Zheng stressed.

This is because price hikes will force demanders to use oil more economically and seek for oil substitutes, and at the same time urge producers to expand production. Some producers of high production costs will also be able to join the rank of suppliers along with soaring prices. Expanded production on one hand and shrank demands and increased substitutes on the other hand will eventually hurt both consumers, suppliers and producers. That's why OPEC always tries to put oil prices within a rational range, such as between $15, 18 and 25. Therefore both the possibility and room for even higher prices are quite limited.

By People's Daily Online