Xinhua news agency reported that China will provide refinery subsidies and control the rise in domestic oil prices if the world oil price rises above $130 per barrel.
The Ministry of Finance said in a statement issued jointly with China’s National Development and Reform Commission that the plan will help stabilize fuel supply, ease the burden on downstream businesses and consumers, and reduce operating costs in the real economy.
The policy will initially be in place for two months, with further announcements to be made if oil prices remain above $130.
Under China’s current pricing mechanism, China adjusts the price of domestic refined products when the global crude oil price for gasoline and diesel fluctuates by more than 50 yuan per ton for 10 working days.
However, if global crude oil prices fall below $40 or exceed the $130 ceiling, China will not raise prices for domestic refined products.