China may cut the retail ceilings of gasoil and gasoline in early October if Brent is largely stable at current levels that are relatively low, right after the holiday for the National Day (Oct 1-7), C1 forecast.
Brent dropped sharply and closed on US$105.49/bbl on Sep 22, down by 4.4% from the previous day because of worry of a new recession. If Brent stays at US$105-106/bbl in early October, the 22-work-day moving average of the crude basket that China refers to for oil product pricing will probably drop by over 4% from last adjustment to the retail ceilings, C1 data showed.
However, the window for downward adjustments to the retail ceilings will stay close if Brent exceeds US$109/bbl.
The 22-work-day moving average declined by 0.57% up till Sep 23, the data indicated.
