China drastically raises up the gasoline price

20-06-2008
China raises prices of oil and fuel
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Source: CCTV.com | 06-20-2008 16:32
China has raised prices of gasoline, diesel and aviation fuel by over 8 percent beginning on Friday. The country's chief economic planning body -- the National Development and Reform Commission -- says the drastic rise in energy prices was made to ensure supplies in the country. It also aims to narrow the gap between fuel prices in China and continuously rising international crude prices.

For the first time in over a year, China has raised the wholesale price of gasoline and diesel.

Taxi-river Zhao Yuxiang found the price of gas per liter has risen 0.8 yuan. It was 5.4 yuan per liter the day before, and now it's 6.2.

Zhao Yuxiang said, " The rising prices could affect our work. So, we hope the government's commitment to reimburse us will be carried out."

Zhao used to spend 220 yuan for 40 liters, but now he has to pay an additional 40 yuan to get the same amount of gas.

But it's not only car users that have been hurt by the price hike. Oil-dependent sectors, such as transport and building will also be affected. And these sectors, in turn, will pass on these new costs to others. However, some others, like oil refining, are beneficiaries.

Professor Zhou Dadi from the National Development Reform Commission says he thinks the current price hikes are reasonable and necessary.
Zhou Dadi said, "For a long time, China's energy prices have not been changed due to certain policy regulations. But the imbalance between oil prices domestically and internationally has already created problems. And the change promotes the process of returning to normal ratios in the future."

But the increase in prices is likely to jeopardize its efforts to curb the rising consumer price index or (CPI).

However, analysts predict the recent price increases in China are unlikely to lead to inflation.

Zhou Dadi said, " Inflation is not generated by the prices of energy, it's mainly because of the excess liquidity. "

The benchmark gasoline and diesel oil retail prices go up by a thousand yuan per ton, with the price of aviation kerosene going up 1,500 yuan per ton. The prices of natural gas and liquefied petroleum gas remain unchanged.

People's reactions are mixed.

Nevertheless, the rise in energy prices will bring changes.

China has been struggling with how to deal with rising global oil prices while reining in record inflation at home. Experts believe if global crude oil prices maintain their current high level, there is room for the Chinese Government to raise domestic oil prices even further.

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News & Politics

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[SafferAttack]

could they not get a better anchorman? someone with lisp doesnt fit that job description

[doctorturbo]

well it's about time.

they must have a loser gov. that uses SPECULATORS.

like ours does