Beijing, June 8
China’s economic planning ministry said Friday it will lower benchmark retail prices of gasoline and diesel by 530 yuan ($84) and 510 yuan per tonne respectively.
The drop in prices will be implemented beginning Saturday, the National Development and Reform Commission said in a statement on its website.
The cut will effectively see gasoline prices at the pump fall by around 0.39 yuan (six cents) per litre and diesel by 0.44 yuan per litre, a fall of about four percent, it said.
The price cuts were the first since May 10, when the commission cut gasoline prices to 8,850 yuan per tonne from 9,180 yuan a ton set on March 20, state press reports said. At the time, diesel prices were cut by a similar amount.
China routinely adjusts retail oil prices bringing them in line with global prices.
China is the the biggest energy consumer in the world, and the second biggest consumer of oil.
Meanwhile, oil prices fell in Asian trade Friday as hopes dimmed for stimulus measures to re-energise the faltering US economy, analysts said.
New York’s main contract, light sweet crude for delivery in July, was down $1.43 to $83.39 a barrel and Brent North Sea crude for July delivery shed $1.24 to $98.69 in the afternoon.
"Oil prices have fallen along with equity markets after (US) Federal Reserve chairman Ben Bernanke tempered hopes that there would be more stimulus for the US economy," said Victor Shum, senior principal at Purvin and Gertz international energy consultants in Singapore.
Bernanke’s failure to signal any new stimulus on the way for the world’s biggest economy, in remarks Thursday to a Congressional panel, dragged on equity and oil markets. The United States is the world’s top oil consumer.
Worries are also mounting over Chinese demand after Beijing announced a cut in interest rates on Thursday to boost the world’s second largest economy and biggest energy consumer.
"The interest rate cut by China is also weighing on the market. It is being seen as a sign that the May economic data that will be released soon are quite weak," he added.
Monetary easing had been expected in China following dismal economic figures in April and weak manufacturing numbers in May.