Domestic oil product retail ceilings are expected to be lifted in mid-May, but the rises might be lower than the latest two hikes.
As of Apr 25, the 22-working-day moving average price of Brent, Dubai and Cinta crude climbed 5.03%, C1's data indicated. The benchmark price is more likely to rise as high as 6-7% by May 9, the date with price adjustment window open in theory.
May is a peak season for gasoil demand, and prompt price increases would be helpful to ease supply tightness, market sources denoted.
The National Development & Reform Commission usually implements hikes in oil product prices more than two weeks after the adjustment window becomes open.
Owing to supply tension, gasoil wholesale prices surged above retail ceilings in some areas, C1 reported earlier.
However, the government may narrow price increases to merely Yuan 150-200/mt by then, taking into consideration interest of producers and affordability of consumers, according to the sources.
China hiked oil product prices twice in 2011 amid spiraling crude prices. The latest hike happened on Apr 7, with gasoline up Yuan 500/mt and gasoil up Yuan 400/mt.
