Fuel prices at new highs

(Shenzhen Daily)
Updated: 2006-06-12 11:10
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"We are involved a campaign to deliver diesel to the fields," said a second Sinopec official from the eastern province of Shandong, adding that they charge farmers a lower retail price of around 5,400 yuan a ton.

Diesel consumption by agricultural users is small compared with guzzlers in the transportation and construction sectors, but the government wants to make sure the recent price increase, the biggest since 2000, would not hit farmers too hard and trigger unrest.

Officials shrugged off the impact from China's annual fishing ban off its coasts from June through August that would normally cut diesel consumption.

"Supplies are tight and our stocks are every low, so the impact from the fishing ban will be negligible," the Shandong official said.

Production at China's 12 top refineries was about 4.5 percent lower this month from May due to a slew of planned maintenance shutdowns.

Gasoline was also at a record 5,900 to 6,050 yuan per ton for the benchmark 90-octane grade, up from 5,650 to 5,750 yuan several weeks ago, with prices likely to rise further as drivers switch on fuel-intensive air-conditioners this summer.

While some private car owners drove less to trim soaring gas bills, China's swelling fleet of family vehicles has bolstered gasoline demand.

New car sales in April grew 39 percent from 468,400 units a year ago, taking total car sales in the first four months up nearly half to 1.72 million.

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