China will cut gasoline and diesel prices tomorrow for the first time since July, threatening to reduce refiners’ processing margins in the world’s second- biggest oil-consuming nation.
The maximum at which gasoline can be sold to motorists will fall by 310 yuan ($50) a metric ton and diesel by 300 yuan from tomorrow, the National Development and Reform Commission said in a statement on its website today.
The pump price of 90-RON, China III gasoline in Beijing will decline 3.1 percent to 9,730 yuan a ton, or $4.46 a U.S. gallon, according to data compiled by Bloomberg from the NDRC.
The China III specification is similar to the Euro III fuel standard. Brent crude has dropped 4.7 percent since fuel prices were last revised on Sept. 11.
The cut, which follows increases in August and September, may hinder efforts by China’s oil companies to curb losses from selling fuel at state-controlled prices.
PetroChina Co., the nation’s second-biggest refiner, reduced its processing loss in the first nine months of this year by 11.5 billion yuan from the same period in 2011 to 30 billion yuan, it said Oct. 30.
Its bigger rival China Petroleum & Chemical Corp. (386), known as Sinopec, didn’t give a figure for its refining operation as it posted a total third-quarter profit that beat analysts’ estimates.
“Sinopec will still be able to make a profit from refining after the price cut, though the margin will be close to its breakeven point,” Shi Yan, a Shanghai-based energy analyst at UOB-Kay Hian Ltd., said by telephone.“The price cut is within market expectations.”
Share Prices
Sinopec slid 1.9 percent to close at HK$7.85 in Hong Kong before the announcement.
PetroChina dropped 1.8 percent to HK$10.10, and the benchmark Hang Seng index fell 1.6 percent.
Brent crude, the benchmark price for more than half the world’s oil, was at $110 a barrel today on the London-based ICEFutures Europe exchange.
Prices have dropped 14 percent since reaching a high this year of $128.40 on March 1. Gasoline and diesel costs are set by the NDRC under a system that tracks the 22-day moving average of a basket of crudes comprising Brent, Dubai and Indonesia’s Cinta.
The government may revise fuel rates when the measure changes more than 4 percent from the last adjustment.
That figure was reached yesterday, the NDRC said in a separate statement today. C1 Energy reported the price cut after the Hong Kong stock market closed and before the official announcement, citing information from two unidentified oil companies.
The Shanghai- based commodity researcher, which has previously reported fuel- price adjustments before the government statement, had predicted the revision would happen yesterday.
It may have been postponed because of the Chinese Communist Party congress, C1 said. The 82 million-member party that has run China since 1949 today announced its fifth generation of leaders, headed by Xi Jinping, who replaces Hu Jintao as general secretary.
bloomberg.com
The maximum at which gasoline can be sold to motorists will fall by 310 yuan ($50) a metric ton and diesel by 300 yuan from tomorrow, the National Development and Reform Commission said in a statement on its website today.
The pump price of 90-RON, China III gasoline in Beijing will decline 3.1 percent to 9,730 yuan a ton, or $4.46 a U.S. gallon, according to data compiled by Bloomberg from the NDRC.
The China III specification is similar to the Euro III fuel standard. Brent crude has dropped 4.7 percent since fuel prices were last revised on Sept. 11.
The cut, which follows increases in August and September, may hinder efforts by China’s oil companies to curb losses from selling fuel at state-controlled prices.
PetroChina Co., the nation’s second-biggest refiner, reduced its processing loss in the first nine months of this year by 11.5 billion yuan from the same period in 2011 to 30 billion yuan, it said Oct. 30.
Its bigger rival China Petroleum & Chemical Corp. (386), known as Sinopec, didn’t give a figure for its refining operation as it posted a total third-quarter profit that beat analysts’ estimates.
“Sinopec will still be able to make a profit from refining after the price cut, though the margin will be close to its breakeven point,” Shi Yan, a Shanghai-based energy analyst at UOB-Kay Hian Ltd., said by telephone.“The price cut is within market expectations.”
Share Prices
Sinopec slid 1.9 percent to close at HK$7.85 in Hong Kong before the announcement.
PetroChina dropped 1.8 percent to HK$10.10, and the benchmark Hang Seng index fell 1.6 percent.
Brent crude, the benchmark price for more than half the world’s oil, was at $110 a barrel today on the London-based ICEFutures Europe exchange.
Prices have dropped 14 percent since reaching a high this year of $128.40 on March 1. Gasoline and diesel costs are set by the NDRC under a system that tracks the 22-day moving average of a basket of crudes comprising Brent, Dubai and Indonesia’s Cinta.
The government may revise fuel rates when the measure changes more than 4 percent from the last adjustment.
That figure was reached yesterday, the NDRC said in a separate statement today. C1 Energy reported the price cut after the Hong Kong stock market closed and before the official announcement, citing information from two unidentified oil companies.
The Shanghai- based commodity researcher, which has previously reported fuel- price adjustments before the government statement, had predicted the revision would happen yesterday.
It may have been postponed because of the Chinese Communist Party congress, C1 said. The 82 million-member party that has run China since 1949 today announced its fifth generation of leaders, headed by Xi Jinping, who replaces Hu Jintao as general secretary.
bloomberg.com
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