BEIJING, Nov 2 (Reuters) - Drivers in China’s financial hub of Shanghai have started filling their tanks with cleaner motor fuel but are not yet paying higher prices like their counterparts in the capital Beijing.
But the situation may soon change as the government could raise prices in the city to cover the extra cost of producing cleaner fuel in a widely-expected national fuel price hike that could happen any time.
China may raise retail fuel prices by 5-6 percent after benchmark crude prices rose more than 6 percent since Beijing’s last price move, analysts said. [ID:nPEK365823]
Shanghai formally introduced Euro IV standard fuel from Nov. 1, the second Chinese city to introduce the standard after Beijing, in an effort to reduce pollution and improve air quality in the run-up to the World Expo next year.
On Tuesday, the pump price for widely-used 93-octane gasoline in Shanghai remained the same as before: 5.9 yuan a litre or $3.27 a gallon, officials with several petrol stations with Sinopec (600028.SS) (0386.HK) said.
The price for 98-octane gasoline was 6.8 yuan a litre and 5.64 yuan a litre for diesel.
“We have not received any notice to change the price,” said one official in a Sinopec service station. Sinopec is the leading fuel supplier in the city.
Petrol prices sold by rival PetroChina’s (601857.SS)0857.SS 127 service stations also remained the same as before, according to a report by China Petroleum Daily, a newspaper run by CNPC, PetroChina’s parent.
Gasoline prices in Beijing were raised more than 2 percent and diesel by around 4 percent in 2008 to cover the cost of cleaner fuel.
Fuel standards in most Chinese regions are based on Euro II and the government plans to move up to Euro III from next year. (Reporting by Jim Bai and Tom Miles, Editing by Jacqueline Wong)