China's two dominant state oil companies will delay refinery maintenance work, among other moves, to safeguard domestic transport fuel supply, the top planning agency said yesterday.
China Petrochemical Corp and China National Petroleum Corp will also manage to source diesel supply from various channels and strictly limit exports to ensure home supply, the National Development and Reform Commission said in a Website statement.
A fuel supply shortage has hit across the country over the past several weeks amid soaring crude prices, forcing a number of petrol stations to ration diesel and leaving many pumps dry.
Crude prices, expected to reach US$100 per barrel soon, have exacerbated losses for Chinese refineries as the refined oil products prices are set by the government to keep inflation in check.
Although the NDRC raised retail fuel prices by up to 10 percent, effective on November 1 - the first rise in 17 months and an urgent response to the soaring crude rates - the move is thought to only soften local refineries' woes.
Chinese refineries could only break even when crude is below US$65 a barrel, based on the pre-rise refined fuel prices, company officials have said.
"The market reaction is generally positive after the rise, which reduces the negative impacts on the lower fuel prices," the NDRC statement said.
The NDRC said it convened a meeting with officials from the two largest oil companies on Monday, discussing the domestic market condition after the fuel price rise.
China Petrochemical, parent of Sinopec Corp, and CNPC, parent to PetroChina Co, both pledged to strictly implement the new fuel sales prices, to ensure a stable market.
In addition to delays in refinery maintenance and curbing exports, the companies also agreed on quicker delivery and more exploration for oil and gas.
Separately, the NDRC told edible oil makers not to fix prices and hoard products, against the backdrop of high consumer prices.
"Companies are under obligation to lower operating costs by improving management, to provide consumers with products of reasonable prices," it said. |
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