On April 7th, the National Development and Reform Commission announced that starting from 24:00 on April 7th, the domestic prices of gasoline and diesel (standard products) should be increased by 800 yuan and 770 yuan per ton respectively, with actual increases of 420 yuan and 400 yuan after regulation. This is also another regulatory measure taken by the country after the implementation of the regulation on domestic refined oil prices on March 23. The rise and fall of oil prices are touching people's hearts. How is the price of refined oil products determined in China? Under what circumstances will regulatory measures be taken? If international crude oil prices rise significantly in the later stage, what regulatory measures will be taken? In response to these issues, the reporter interviewed relevant departments and experts. Domestic refined oil prices are linked to international crude oil prices. Readers are concerned about how the domestic refined oil prices in China are determined? It is reported that the current domestic refined oil price mechanism is mainly based on the "Petroleum Price Management Measures" (hereinafter referred to as the "Measures") issued by the National Development and Reform Commission in 2016. China is a major importer of oil, with a crude oil extraction ratio of over 70%. The Measures stipulate that the prices of gasoline and diesel shall be adjusted every 10 working days based on changes in international crude oil prices. Lv Zhichen, Deputy Director of the Price Cost and Certification Center of the National Development and Reform Commission, introduced that this mechanism has three key points - "one package". The domestic prices of gasoline and diesel are tied to the average price of a package of international crude oil, and price adjustments are influenced by multiple factors rather than a single international crude oil price. The average price. The magnitude of price adjustment is not simply determined by the changes in international crude oil prices at individual points in time or on certain days, but depends on the comparison between the average price of a package of international crude oil in the 10 working days before the adjustment and the average price in the 10 working days before the last adjustment. Interval regulation. Under certain circumstances, the government will take price control measures. In recent years, China's domestic refined oil prices have been adjusted according to the mechanism, with some rising and some falling. In 2023, the price of refined oil will increase by 10, decrease by 12, and remain unchanged for 3 years. In 2024, it will increase by 9, decrease by 7, and remain unchanged for 7 years. In 2025, it will increase by 7, decrease by 12, and remain unchanged for 6 years. The total price for the three years will increase by 26, decrease by 33, and remain unchanged for 16 years. Recently, the international market crude oil prices have fluctuated significantly, especially in the Middle East where crude oil prices have hit historic highs. These factors have directly raised China's import and oil costs, and have also led to an overall upward trend in domestic refined oil prices. Temporary regulation is conducive to mitigating the impact of abnormal international oil price increases. Readers are concerned: under what circumstances will the country take regulatory measures on oil prices? Tian Lei, Deputy Director of the Economic Center of the Energy Institute of the Chinese Academy of Macroeconomics, said that according to the current mechanism, when the international crude oil price of a package is higher than $130 per barrel or lower than $40 per barrel 10 working days before the price adjustment, the country will take price control measures. At present, the international crude oil prices have not yet exceeded the "ceiling price" of $130 per barrel. Why have two temporary adjustments been taken recently? The main basis is Article 7 of the Measures: "When there is a significant increase in the overall domestic price level or a major emergency event, as well as special circumstances such as abnormal fluctuations in international market oil prices that require regulation of refined oil prices," "price adjustments may be suspended, delayed, or reduced. On the basis of maintaining the current price mechanism framework, temporary regulation of domestic refined oil prices takes into account the interests of both consumers and producers, which is conducive to mitigating the impact of abnormal international oil price increases, reducing the burden on downstream users, and ensuring stable economic operation and social livelihood. ”Tian Lei said. The prices of gasoline and diesel released by the National Development and Reform Commission are for 'standard products' measured in tons, namely 92 octane gasoline and 0 octane diesel. ”Lv Zhichen said that taking the regulation on March 23 as an example, the domestic prices of gasoline and diesel (standard products) should be increased by 2205 yuan and 2120 yuan per ton respectively. After the regulation, the actual price increases were 1160 yuan and 1115 yuan, which is equivalent to a price increase. The prices of 92 gasoline and 0 diesel were increased by about 0.87 yuan and 0.95 yuan per liter respectively, which is about 0.85 yuan less than the price increase without regulation. On April 7th, this regulation resulted in a decrease of 0.31 yuan per liter for 92 octane gasoline and 0.32 yuan per liter for 0 octane diesel. If the upper limit of price regulation is triggered, the price of refined oil products will not increase or increase slightly. Readers are concerned: If international crude oil prices rise significantly in the later stage, what regulatory measures will the country take? If the average price of a package of international crude oil continues to rise significantly, exceeding $130 per barrel (corresponding to a domestic average retail price of 92 octane gasoline roughly higher than 10 yuan per liter), it will trigger the upper limit of price regulation. ”Tian Lei told reporters that for the portion exceeding the upper limit, the maximum retail prices of domestic gasoline and diesel will not increase or will increase slightly. At the same time, in order to stabilize supply, the country may adopt some financial and tax support policies. In the past, the Russia-Ukraine conflict in 2022 triggered a sharp rise in international oil prices. The state then made it clear that when the international oil price broke the regulatory ceiling of 130 dollars per barrel, the domestic oil product price would not rise in the short term (no more than two months), and would give periodic subsidies to oil refining enterprises. The National Development and Reform Commission stated that it will guide refined oil production and sales enterprises such as PetroChina, Sinopec, and CNOOC to fully carry out refined oil production and transportation, ensure stable market supply, and strictly implement national pricing policies. Relevant departments in various regions should increase their market supervision and inspection efforts, strictly investigate and punish behaviors that do not implement national price policies, and maintain normal market order. If encountering any illegal pricing behavior, consumers can report it through the 12315 platform. (New Society)