China Cuts Fuel Prices

China’s central economic planner has announced cuts to gasoline and diesel prices, set to take effect today, following the price rout in international crude oil.

Starting today, a ton of gasoline will cost some $66 less, the National Development and Reform Commission said, as quoted by Xinhua. A ton of diesel will cost $64 less.

The state-owned oil and gas majors CNPC, Sinopec, and CNOOC have been directed to ensure an adequate supply of the most used fuels, the report noted, along with smaller refineries.

Oil prices have taken a dive amid Trump’s tariff offensive, but this week staged a recovery, albeit hesitantly. Brent crude and WTI ended their losing streak posting gains for the shorter-than-usual week before Easter, with Brent crude at close to $68 per barrel and WTI at just under $65 per barrel. Last week, in contrast, Brent crude dipped below $60 for a short while.

This week, however, hopes about trade deals have grown as various nations offer to boost their imports from the United States in exchange for avoiding tariffs. These hopes experienced a growth spurt on Thursday, after President Trump signaled the tit-for-tat tariff exchange with Beijing may be about to end.

“I don’t want them to go higher because at a certain point you make it where people don’t buy,” Trump said yesterday, as quoted by Reuters. “So, I may not want to go higher or I may not want to even go up to that level. I may want to go to less because you know you want people to buy and, at a certain point, people aren’t gonna buy.”

This follows an indication by China that it will not engage in a tit-for-tat numbers exchange forever. “Even if the U.S. continues to impose even higher tariffs, it would no longer have any economic significance and would go down as a joke in the history of world economics,” the Finance Ministry in Beijing said last week. “If the U.S. continues to play a numbers game with tariffs, China will not respond,” the ministry also said.

By Irina Slav for Oilprice.com

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