Oil prices rises push inflation up, GDP growth down

A government economist told state media said rising oil prices would push up inflation, impacting corporate profits and transport costs for consumers. Higher crude costs would also slow economic growth by .08%, adjusting GDP growth down to 9% for the year, Niu Li, a senior state Information Centre economist, said. The growth figure is lower that the current projection of 9.8% but still far from the 7% Chinese Premier Wen Jiabao projected in March. Niu said that if oil prices stay at current levels, China would have to pay an extra US$8.8 billion for its yearly intake of 880 million barrels of oil, considerably more than earlier cost estimates for the year. He said higher crude prices partially explained increases in production and material costs.