SASAC to continue SOE fuel deal probe

SHANGHAI: The State supervisory agency has said that it would continue its investigation into the fuel oil derivative contracts although they are turning a profit for the State-owned airlines because of rising crude prices.

Beijing-based Caijing Magazine yesterday quoted an official of the State-owned Assets Supervision and Administration Commission (SASAC) as saying: "As a supervising body, we have the responsibility to check on the compliance of these contracts." The official added that the investigation would focus on the legitimacy of these derivative deals irrespective of gains or losses.

Gains from these contracts are known to have greatly boosted the profits of the nation's two major airlines, Air China and China Eastern. Both the carriers had posted more than 100-percent increase in third-quarter profit from a year earlier.