China hikes fuel prices 6-6.5%

China will increase the price of gas by 6% and diesel by 6.5% from Tuesday to keep pace with rising global crude prices, Reuters reported. Under existing pricing regulations, the government can revise fuel prices given a more than 4% increase in crude price indicators over a 22-day period. Last Friday, the 22-day moving average price was 8.4% higher than on August 10, according to information provided by the Independent Chemical Information Services. This is the second time fuel prices have increased in roughly a month, following three price cuts between May and July. While higher prices could help state-owned oil companies such as Sinopec (SHI.NYSE, 600688.SH, 0338.HKG) counter losses, they may also reduce demand in a period when consumption is flagging.