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Chairman of China Petroleum & Chemical Corporation:Domestic oil price may be raised prior to May 28

Source: Author£ºadmin Hits£º9454 Time£º2009/7/6 9:59:12
¡¡¡¡ Beijing Published on May 24 (journalist: Fengya) reporting from The Sounds of China China National Radio News at 13:55 pm

Will domestic oil price be increased in tandem with continuously increasing international oil price? If yes, When£¿With this question, The Sounds of China interviews China National Radio journalist Fengya:

The Sounds of China£ºAccording to relevant administrative measures, the price of product oil in China will be raised, but this has not yet occurred, what do you think is the difficulty in doing so? Will the price be raised in the near future?

Fengya: I think you have learned about the difficulty. Now domestic economy has not yet completely improved, raising oil price will increase costs for enterprises and will exert impact on all the sectors relating to oil and trigger chain reaction. 

The State’s relevant departments are also hesitating as to the timing for and extent of raising oil price. Thus experts are considering whether it is appropriate for linking domestic oil price to the international one, if raising oil price at this time, the raising degree should not be high. Experts also put forward suggestions that National Development and Reform Commission or relevant departments should launch implementation according to their respective policies and raise oil price as soon as practicable based on the existing mechanism since longer delay will be responded with more speculation.

Furthermore, according to the Administrative Measures for Oil Price promulgated by National Development and Reform Commission on May 7, domestic petrol and diesel oil price may be adjusted accordingly when international crude oil price has changed on average more than 4% for 22 consecutive working days. However, no specific calculation of product oil price including the benchmark of crude oil price, average processing cost and reasonable profit is available in the Administrative Measures for Oil Price. Now it is very difficult to judging the extent of urgency for raising oil price.

According to Chairman of China Petroleum and Chemical Corporation, Sinopec is closely following and feels anxious about the time for adjusting product oil price since Sinopec’s oil refining segment will have a deficit if the current crude oil price of 60 yuan per barrel is adopted, if taking into account 22 consecutive working days, oil price can also be adjusted on May 28 at latest.