China set for fuel price hike in response to rising crude costs

China will increase gasoline and diesel prices by as much as 5.8% from Thursday in response to rising global crude oil costs, Bloomberg reported. The National Development and Reform Commission (NDRC) said gasoline prices would rise by US$76.40 a metric ton while diesel climbs US$61. The ex-factory cost of No.3 jet fuel will also increase by US$76.40 a metric ton. Under a mechanism introduced in December 2008, the NDRC is able to alter fuel prices when crude oil costs change by more than 4% over 22 working days. Crude in New York has risen 28% since February 15, spurred by unrest in Libya, Africa’s third-largest oil producer. The NDRC first responded to the situation on February 20, raising gasoline and diesel prices by up to 4.6%. Higher fuel costs will add to inflationary pressure in China, with the March consumer price index expected to match or even exceed the 4.9% growth see in February.