文档介绍：October 7, 2008 China: Energy: Oil - Integrated
October 7, 2008
China: Energy: Oil - Integrated
Product price hike in Beijing has modest impact; prefer Sinopec
Product prices raised 3-4%; only in Beijing
The Beijing mission of Development and Reform RELATED RESEARCH
announced on October 6 that the retail gasoline and diesel prices in Beijing Asia Pacific: Energy: Oil: Price hike sooner + bigger than
would be revised up by Rmb200/tonne (~3%) and Rmb290/tonne (~4%) expected; upgrade SNP, SPC + PTR (June 20, 2008)
respectively, effective from October 7.
Implications
This hike is pensate refiners for the higher costs of Euro-IV
products, and not an alignment of local prices to international prices. With
the sharp pullback of crude oil prices, China’s domestic gasoline and diesel
prices are now 5% and 6% above import parity prices respectively. Given
weakening global economic conditions, we believe now is the right time
for the government to consider liberalizing domestic gasoline and diesel
prices.
Domestic refining margins have rebounded sharply to above breakeven
levels. In addition, the diesel-fuel oil spread has also returned to the
normal positive territory, which is driving independent refiners to resume
operation. We believe this is incrementally negative for diesel but positive
for fuel oil in the regional markets. With the