Posted on 09/19/2007 4:19:16 PM PDT by shrinkermd
BEIJING, Sept 19 (Reuters) - China's move to freeze prices of commodities under state control, including oil products, will sustain robust demand despite record-high crude, tightening supplies and inflame refining losses, industry officials said.
Beijing's announcement on Wednesday not to raise prices that it controls for the rest of 2007 amid mounting fears over inflation also threatened to force the shutdown of independent small refineries that supply 15 percent of China's oil market.
With U.S. crude (CLc1: Quote, Profile, Research) above $82 a barrel, China's domestic fuel price freeze will lead to greater losses at all its refineries.
Beijing last raised pump prices for gasoline and diesel in May last year, before tweaking gasoline rates lower in January and has since kept prices unchanged, shielding consumers from a more than $10 spike in global oil markets.
State refiners Sinopec Corp (0386.HK: Quote, Profile, Research) and PetroChina (0857.HK: Quote, Profile, Research), which would see refining margins plunging deeper into the red, may be enticed to cut output or raise fuel exports in coming months, or both, to salvage their bottom lines.
(Excerpt) Read more at uk.reuters.com ...
makes it hard to pump
This didn’t work too well for Mugabe. I wonder if we’re not seeing the beginning of something really big here. Surely the Chicoms know better.
Didn’t we try something like this back in the seventies with disasterous results?
OH well, it’s just the chicoms.
Frozen oil... Is that another commie plot?
Good luck with that.
China’s economy is going so strong the only thing that could foul it up is commies acting like commies.
Yes, price controls don’t usually work, so I doubt this will help China’s economy. I have to wonder if China’s runaway economy will falter as Japan’s did. It wasn’t that long ago everyone was concerned Japan was buying out the United States.
........usually don’t work......
In addition to communists, there are an ever increasing number of business people rising in the ranks. Neither group knows what to do for the simple reason they have never been there before.
The control might be considered a brake..... it will only last for 90 days or so.
We’ll watch closely won’t we.
It will be showing up on the markets in a month or two ... they are just waiting for the Xmas season to launch it ... you do know frozen oil does not move as fast as regular temp. oil ... so we should get more miles to the gallon!
Someone is simply going to stop working. Losing money does that.
I think it’s the retail (pump) price that they’re trying to control — not what they pay on the World Market.
Freeze the price & demand will outstrip supply at some point.
Yeah, the Nixon administration tried it and it was an abject failure. Every regime that has attempted it has failed in its goals.
"Those who cannot remember the past are condemned to repeat it."
George Santayana, The Life of Reason, Volume 1, 1905 US (Spanish-born) philosopher (1863 - 1952)
China’s currency is pegged to the dollar.
The US is working to devalue the dollar and lower our debt problem.
China has no debt problem. (except for the amount of US treasuries it holds)
But if the dollar is devalued so will China’s currency.
At some point in the US vs China monetary chicken game, someone will blink. I can’t guess who that will be.
China has already limited raw materials sales to other countries to stem the loss of those at below market values.
They can artifically control prices for only a short time.
The last time China did this, it has gas lines. I’m sure this time will be no different.
Good luck with that.
Perhaps the Chicoms will invade Saudi Arabia and just take the oil. Sounds familiar, any how.
Another commie plot regarding precious... fluids.
No wonder the price of oil keeps going up.
for later
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