06-22-2008, 07:14 PM
|
|
|
Confirmed User
Industry Role:
Join Date: Mar 2008
Location: Miami
Posts: 5,527
|
$78.60 a barrel of oil
it's only $78.60 a barrel of oil in CHINA.
Quote:
NEW YORK (Reuters) - China, the world's second largest oil consumer, will increase retail gasoline and diesel prices by 1,000 yuan ($145.50) per tonne from Friday, according to industry sources.
Fuel subsidies have helped propel China's demand and supported a six year rally in crude oil rally that has sent prices up nearly seven-fold.
Oil prices tumbled $3 following the news.
ANALYST COMMENTS:
TIM EVANS, CITI FUTURES PERSPECTIVE IN NEW YORK.
"Even with the $18.60 (per barrel) increase in price (Chinese fuel prices) are still well below the global market and the subsidy amounts to something on the order of $56 per barrel."
"This increase amounts to approximately $18.60 per barrel and will raise fuel costs from an approximate $60 per barrel to
$78.60."
|
So if you live in China, gas is going up for you. But it's half the price the US consumer is paying.
Quote:
JOHN KEMP, COMMODITIES ECONOMIST AT RBS SEMPRA IN LONDON
"This is very significant, a watershed move which suggests the Chinese government is prepared to risk unpopularity to curb the growth in domestic fuel demand. We've already seen other Asian economies cut subsidies and the one big hold out, until now, was China."
MIKE FITZPATRICK, VICE PRESIDENT, MF GLOBAL IN NEW YORK
"The news China will raise fuel prices caused crude prices to retreat. The assumption is demand is going to be hit pretty significantly."
PHIL FLYNN, ANALYST, AT ALARON TRADING IN CHICAGO
"Nobody thought China would raise prices on gasoline and diesel this much. This is huge. Demand should fall."
ERIC WITTENAUER, ANALYST, WACHOVIA SECURITIES, ST. LOUIS:
"Certainly if the Chinese raise their prices, cut subsidies and reduce some of the insulation around their consumers, then you would expect that would impact their demand growth. As the developing countries of the world are underpinning the demand side of this market, this could prove bearish for commodities."
|
|
|
|