|
|
Inflation fears block fuel price rise |
 |
+ |
- |
09:58, July 26, 2007 |
Rising global crude oil prices on the one hand and the growing domestic inflationary pressure on the other have put the government in a difficult situation, making it extremely difficult for it to decide whether and when to raise gasoline and diesel prices.
Cao Changqing, pricing department director of the National Development and Reform Commission (NDRC), said skyrocketing global crude oil prices are putting pressure on China to adjust its domestic prices but the government hasn''t done so yet mainly because of the fear of adding to inflationary pressures.
He said the government is considering subsidies for crude oil refiners to help them meet the growing demand.
While admitting "the dilemma" in deciding on a gasoline price hike this time, the official said the government is committed to letting "market decide gasoline prices" finally. "Our price reform is aimed at uniting the domestic and international prices of refined oil and diesel."
Cao said China needs to adjust its refined oil prices as international prices rose to an average of $72 a barrel last week. China''s crude oil prices have already been linked to the global market but the government still regulates the gasoline and diesel prices.
"The prices of oil products really need adjusting low oil product prices are not conducive to energy saving," said Cao. But he added that the government faces another problem: raising oil product prices may accelerate the current round of inflation.
"So we are in a dilemma now," Cao said yesterday. He added that regulators need more time to assess the situation.
The NDRC has been under pressure to raise gasoline prices. The nation''s two largest oil companies, China National Petroleum Corp and China Petroleum & Chemical Corp, recently joined a group of applicants to seek a price hike for refined oil products.
[1] [2]
|
|
|
Comment
Tell A Friend
Print Format
Save Article