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China will raise the retail ceilings of gasoline by CNY150/mt and diesel by CNY140/mt on July 10 (Wednesday), as international crude prices have rebounded in this pricing cycle, according to industry sources.
Accordingly, there will be a boost of CNY0.11/liter ($0.06/US gallon) in the retail price of national standard 89-RON gasoline, CNY0.12/liter in 92-RON gasoline and CNY0.12/liter in zero-pour-point diesel, JLC data shows.
The price hike on Wednesday will be the 13th price adjustment so far this year, also the ninth price rise. After the markup, the retail ceilings of standard 89-RON gasoline will range between CNY8,185/mt and CNY8,625/mt, and those of standard zero-pour-point diesel will rally to CNY7,310-7,650/mt.
As of July 9, the tenth working day in this pricing cycle for China's gasoline and diesel retail ceilings, the crude basket JLC selects to indicate fluctuations in international crude prices has gained 4.21% from the previous pricing cycle to $62.37/bbl, JLC data shows.
Domestic gasoline and diesel prices have recently climbed because of improving market fundamentals. The wholesale prices of 92-RON gasoline settled at CNY5,950-6,150/mt in north, east and south China and Shandong on July 9, up by CNY50-250/mt from June 26, JLC data shows. Meanwhile, the wholesale prices of diesel gained CNY50-200/mt to CNY6,000-6,650/mt. Gasoline prices are still below those of diesel, and the price spread hit CNY500/mt in some regions, which is a stark contrast to relatively high gasoline prices in past years.
The country last adjusted fuel prices on June 26, cutting the retail ceilings of gasoline by CNY120/mt and diesel by CNY115/mt.
According to China's current gasoline and diesel pricing mechanism, which has been in place since January 2016, the country will adjust fuel prices every 10 working days in line with the fluctuation in international crude prices in the range of $40-130/bbl. It will not adjust fuel prices if crude futures prices are above $130/bbl or below $40/bbl or the resulting price change is less than CNY50/mt, or roughly $1/bbl.
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