Chinese gasoline traders and manufacturers urged the government to ease price controls blamed for shortages in Shanghai, the nation's commercial center, and provinces including Guangdong, the biggest manufacturing hub.
Some retailers are limiting sales to avoid losses because they can't pass soaring supply costs on to customers, industry officials including Liu Jian, chairman of the Shandong-based Oil Product Trading Association of Qingdao, said yesterday.
An increase in gasoline prices would boost manufacturing costs and inflation in China. The nation's economy has tripled in a decade to US$1.6 trillion, more than doubling fuel demand and contributing to the surge in crude oil costs for refiners such as China Petroleum & Chemical Corp, Asia's largest.
"There's a greater need for the government to reform the current oil pricing structure, which is not moving fast enough with the market and international oil prices," Zhang Jingming, company secretary at Sinopec Shanghai Petrochemical Co, a unit of China Petroleum & Chemical, said by phone.
The National Development and Reform Commission, China's top economic policy planning ministry, controls fuel prices, allowing fluctuations of no more than 8 percent from the set level. The commission raised the price of 90 RON grade gasoline in Guangdong 16 percent this year to 4 yuan (US$0.49) a liter, lagging behind the 68 percent surge in the price of Dubai crude oil, Asia's benchmark.
The commission sent "significant additional" supplies to Guangdong to help cope with the crisis, China Central Television reported, quoting Li Yang, a commission official.
"We're sending truckloads of petrol to Guangdong, far exceeding the province's consumption needs," Li said in an interview on CCTV. "We hear the lines of cars waiting to buy gasoline have started shrinking."
Any decision to raise fuel prices further may accelerate inflation, increasing China's consumer price index by as much as 0.6 percentage points, and induce refiners to produce more gasoline, JPMorgan Chase & Co economist Ben Simpfendorfer said in a report on Thursday.
China's inflation accelerated in July for the first time in five months after the government raised fuel and electricity prices. The consumer price index climbed 1.8 percent from a year earlier after rising 1.6 percent in June, according to Beijing- based Mainland Marketing Research Co (China), which releases figures for the statistics bureau.
Energy companies' profits have been squeezed as price controls prevented them from passing higher crude oil and coal costs on to consumers.
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
RSS