Maintain domestic fuel costs; the country continues to implement refined oil price regulation.

Securities Times reporter Han Zhongnan

Against the backdrop of ongoing escalation in the conflict between the U.S. and Iran involving Israel and repeated bouts of geopolitical turmoil in the Middle East, on April 7, China continued to take regulatory measures for refined oil prices. According to the refined oil price mechanism, beginning at 24:00 on April 7, domestic gasoline and diesel (standard grade) prices should be raised by 800 yuan and 770 yuan per ton, respectively. After the adjustment, the actual increases were 420 yuan and 400 yuan. This is the second time since March 23 that the state has implemented a round of refined oil price adjustments.

During this round of adjustment, relevant departments emphasized that CNPC, Sinopec, CNOOC, and other crude oil processing enterprises should organize refined oil production and distribution to ensure stable market supply and strictly implement national price policies. Relevant local departments should step up efforts in market supervision and inspections, severely investigate and punish conduct that fails to follow national price policies, and maintain normal market order.

Since the beginning of this year, the international crude oil market has gone through a round of intense “roller-coaster” price action. Since late February, the U.S. and Israel have launched military strikes against Iran. Iran immediately blocked the Strait of Hormuz and attacked U.S. military bases, triggering severe shocks across global energy and chemical markets. The Strait of Hormuz accounts for about one-fifth of global oil supply, and disruptions to shipping have directly led the market to harbor serious concerns about oil supply in the coming months.

As of March 31, the Intercontinental Exchange (ICE) Brent crude oil futures price had achieved a record monthly gain of more than 60%. Entering April, even though international oil prices have seen some pullback, Brent crude and WTI crude remain at high levels above $100 per barrel.

Market analysts believe that the future trend of international oil prices will depend on three key variables: whether transportation routes become “choked,” whether oil reserves are released, and how long the U.S.-Israel-Iran conflict lasts.

The sharp rise in international oil prices has directly increased China’s costs for importing oil and using oil. On March 23, based on the current mechanism, domestic gasoline and diesel prices should have been raised by 2,205 yuan and 2,120 yuan per ton, respectively. But in order to mitigate the impact brought about by the abnormal surge in international oil prices and reduce the burden on downstream users, the state took temporary adjustment measures, resulting in actual increases of 1,160 yuan and 1,115 yuan.

Industry experts said that, amid continued large-scale and volatile swings in international oil prices, the state implemented adjustments twice in succession. This fully reflects the clear policy orientation of stabilizing domestic fuel costs and ensuring the steady operation of the economy.