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Crude times

Hu Jintao wants to talk about a little something he calls stability. He named it as China’s top priority at a meeting of the Communist Party celebrating the 30th anniversary of the country’s economic reforms. Hu said the key to stability would be boosting the Party’s economic and social role. And boost that role they will! China on Thursday also announced a reduction in retail fuel prices in response to the drop in global crude prices, which are down 73% from their July peak. The reduction appears to be designed to help the country’s manufacturers and airlines. But while we’re on the topic of oil (and airlines), there’s a little controversy brewing between Shenzhen Nanshan Power Station and Goldman Sachs. The Chinese power company is refusing to pay Goldman for losses incurred on oil-related derivatives, claiming the transactions were unauthorized. (They’re always unauthorized when they go south, aren’t they…) While the amount appears to be small – only in the tens of millions – Goldman is afraid this could set a precedent for larger players like Air China and China Eastern Airlines to dispute their losses.

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