Video | Oil Prices Rise Tonight, But the State "Stepped In": Each Liter Increases Less by 0.85 Yuan

Ask AI · How does the domestic refined oil price cap and floor mechanism protect people’s livelihoods?

Starting from 24:00 today (23rd), domestic gasoline and diesel prices will each increase by 1,160 yuan and 1,115 yuan per ton. What are the reasons and key information behind this oil price adjustment?

This oil price adjustment is influenced by the ongoing escalation of the US-Iran conflict.

CCTV Reporter Wang Lei: The reason for this adjustment is clear: it is due to the continued escalation of the US-Iran conflict, which has caused a significant rise in international oil prices. For example, Brent crude futures have increased nearly 40% since the end of February and are currently around $110 per barrel. Oil prices in the Middle East have exceeded $150 per barrel, with an increase of up to 130%.

The rise in oil prices is evident, but behind this domestic oil price adjustment, the reporter noticed two hidden key pieces of information.

Stabilizing oil prices: The government “must act when the time comes”

The first and most crucial point is that the government has “taken action.” According to the current pricing mechanism, domestic gasoline and diesel prices should have increased by 2,205 yuan and 2,120 yuan per ton, respectively. However, the actual increase is about 1,045 yuan and 1,005 yuan less, meaning the average nationwide increase per liter is about 0.85 yuan less.

This result is determined by China’s refined oil pricing mechanism, which allows for regulation of fuel prices under special circumstances such as abnormal fluctuations in international markets. Currently, this is one of those “special circumstances.” The government “must act when the time comes” to curb sharp international oil price fluctuations and prevent them from directly affecting consumers’ daily expenses.

In fact, rising international oil prices are challenging for all countries. In the US, retail gasoline prices have been rising for the past three weeks; in Europe, not only have oil prices surged, but natural gas prices have also increased by over 90% in a month.

Domestic refined oil pricing has a “cap and floor” mechanism

Recently, major international institutions like Goldman Sachs, JPMorgan Chase, and Barclays have significantly raised their forecasts for international oil prices. Will future international oil prices cause a sharp impact on the domestic market?

This brings us to the second key point: China’s refined oil pricing system has a safeguard mechanism with “upper and lower limits.”

If international oil prices fall below $40 per barrel, domestic refined oil prices will no longer decrease accordingly. The “floor” ensures the normal production of domestic refineries and prevents oil shortages or inability to refuel.

If international oil prices rise above $130 per barrel, domestic refined oil prices will not increase or will increase only slightly. The “ceiling” and supporting fiscal and tax policies are used to regulate market prices.

Currently, although international oil prices have not yet broken through the “ceiling,” the government has already “taken action” in advance to control the rapid rise of oil prices.