China: Government Makes First Fuel Price Cut in 16 Months
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Monday, 10 October 2011 |
China announced that it has reduced retail prices for both gasoline and diesel by 300 yuan per tonne, effective October 9. The retail price for gasoline has fallen by 0.22 yuan per litre, with diesel falling by 0.26 yuan per litre, the National Development and Reform Commission (NDRC) confirmed.
The move marks the first time the Chinese Government has cut fuel retail prices in 16 months, and is consistent with its efforts to combat growing inflation in the country. Since the last fuel price cut, the Government had increased fuel prices four time to keep pace with the rising cost of crude.
The new price cut will lower social operational costs, reduce price hike pressures and promote steady development, according to NDRC’s Director of Pricing, Coa Changging. In the long term, the NDRC said, reform of the pricing mechanism is planned – however, discussions are still underway and the new mechanism will be unveiled after consensus is reached.
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