China Plans Fuel Price Measures If Oil Exceeds $130, Radio Says By Bloomberg News - Apr 7, 2011
China will introduce tax measures to ensure sufficient fuel production if global oil prices exceed $130 a barrel, China National Radio reported today, citing an unidentified National Development and Reform Commission official.
Domestic prices of gasoline and diesel may not be increased after crude reaches that level, the state broadcaster said, citing the official.
China raised retail fuel prices yesterday for the second time this year after oil advanced to the highest in more than 30 months, undermining government effort to cap costs and cool inflation. Crude in London settled at $122.67 a barrel yesterday, the highest since August 2008.
The government won’t allow imported inflation to spur increases in domestic consumer prices, China National Radio reported, citing NDRC Vice Chairman Peng Sen. Price increases will taper off toward year-end, Peng was cited as saying.
China is studying measures to stabilize the price of rice, Peng was cited as saying in a separate report by China Central Television today. The government may implement measures for rice “similar” to what it did for wheat last year, when subsidies were handed to the country’s large grain companies, according to Peng.
In the longer term, the government aims to “further optimize” the way it prices gasoline and diesel before 2015 and will adjust the pricing system for natural gas, water and renewable energy, China National Radio said yesterday.
The government also wants to guarantee the profitability of the nation’s electricity generators by making “gradual” changes to power pricing, the broadcaster said, citing Peng.