Shanghai’s pump rates will go up by about 2.5 percent from today after China adjusted its fuel prices for the first time in more than a month amid rising crude costs.
Unrest in the Middle East, particularly in Syria, has sent the WTI crude to its highest in more than two years and Brent futures to a six-month high earlier this week.
At local pumps, the ceiling price for 93-octane gasoline is now 7.89 yuan (US$1.29) per liter, up from 7.70 yuan, while 97-octane gasoline will cost 8.39 yuan, up from 8.19 yuan. Zero-grade diesel is 7.79 yuan from the previous 7.60 yuan.
But rates vary among provincial areas.
Nationwide, gasoline price goes up by 235 yuan per ton and diesel 225 yuan per ton, or 0.17 yuan per liter for the benchmark 90-octane gasoline and 0.19 yuan per liter for zero-grade diesel on average, according to the National Development and Reform Commission, which sets energy prices.
The NDRC, which reviews fuel rates every 10 working days, last adjusted them on July 20.
Domestic fuel prices are adjusted when international crude prices reflect a change of more than 50 yuan per ton for gasoline and diesel over a period of 10 working days.
The NDRC did not adjust prices in the previous two reviews because the changes in crude prices were not big enough. But the rising oil prices may pave the way for more rate hikes in the near future.
Fuel rates are likely to keep an upward momentum when the NDRC meets again on September 13, analysts with the ICIS C1 Energy said in a report.
“Should tensions in the Middle East ease and crude prices retreat a bit, the NDRC will stick to the rates, rather than reduce the prices,” they said.
While the new prices will hurt motorists, airlines and manufacturers, the higher refined oil product prices will benefit China’s two big refiners, Sinopec Corp and PetroChina Co.
Separately, the NDRC also announced better-than-forecast on-grid tariffs for electricity generated from solar power as it works to encourage the development of renewable energy.
The on-grid prices, charged by power generators to grid companies, will be set at three benchmark levels — 0.90 yuan, 0.95 yuan and 1 yuan per kilowatt-hour — nationwide, the commission said yesterday.