Development and Reform Commission Says Oil Prices "Raise or Slow Down" is a Misunderstanding

The nation's rumors of the Internet circulated that “the decline in international oil prices and domestic oil prices have risen”, the relevant person in charge of the National Development and Reform Commission’s Price Division explained the question raised by netizens yesterday through the official website.

The responsible person pointed out that comparing June 2008 with the current international and domestic oil prices, it is necessary to fully consider the factors of the country’s macro-control and taxation reforms in order to reach an objective and accurate conclusion. The first is to reduce oil prices in the international market. Rising sharply, especially the impact of abnormal speculation factors on the domestic market, the country began to regulate the price of refined oil in 2003. The price of refined oil is often only once or twice a year, and the domestic oil price increase is far less than the international market. Second, by the end of 2008, the state implemented reforms of refined oil prices and taxes, and increased the unit tax for gasoline and diesel consumption by 0.8 yuan and 0.7 yuan per litre, respectively, at 1110 yuan and 823 yuan per ton. As the refined oil consumption tax is an in-quota tax, It is ultimately reflected in the refined oil price. If the deduction of the consumption tax increase factor, the current domestic 90th petrol ex-factory price is equivalent to 6,080 yuan per ton, which is still 400 yuan lower than the gasoline price raised after June 20, 2008, at 6,480 yuan per ton. .

The person in charge also pointed out that the view that the domestic oil price circulated in the country “sluggishly falls slowly and rises more or less and less” is also a misunderstanding. Since the country introduced a new refined oil price mechanism at the end of 2008, the international market crude oil has risen from US$45 per barrel. The volatility climbed up to the current level of around US$76, with a cumulative increase of nearly 70%, while the domestic oil price rose not more than 30% after six lifts and four declines in price adjustment over the same period. The domestic refined oil price was reduced to crude oil prices by the end of 2008. About 45 US dollars per barrel rose to the current 68.3 US dollars, the cumulative increase of about 50%, in fact, lower than the international market crude oil price increases.