Refined oil retail prices have dropped after remaining unchanged for two consecutive adjustment cycles.
On October 13, the National Development and Reform Commission announced that due to recent fluctuations in international oil markets, based on the comparison between the average prices of the 10 working days before October 13 and the average prices of the 10 working days before the previous adjustment, and in accordance with the current refined oil pricing mechanism, domestic gasoline and diesel prices (standard products) will be reduced by 75 yuan and 70 yuan per ton respectively, effective from 24:00 on October 13. This marks the eighth reduction in domestic refined oil retail prices this year.
"The current refined oil pricing cycle spanned the National Day holiday. Before the holiday, international oil prices rose continuously due to disrupted Iraqi export expansion plans and declining U.S. crude inventories. Although market concerns about oversupply made traders cautious, geopolitical tensions provided support for international oil prices. After the holiday, as traders' concerns about trade and economic issues intensified, crude prices fell consecutively," said Dai Tiandong, a refined oil analyst at JLC Network Technology, during an interview. Under this influence, the crude oil change rate initially rose but then turned from positive to negative and deepened within the negative range. As of the close on October 10, the domestic 10th working day reference crude oil change rate was -1.81%.
According to JLC Network Technology's calculations, this reduction in gasoline and diesel retail prices translates to a decrease of 0.06 yuan per liter for 92-octane gasoline, 95-octane gasoline, and 0-grade diesel. After this price adjustment takes effect, private car owners will spend 3 yuan less when filling a 50-liter tank with 92-octane gasoline.
From the perspective of this pricing cycle, the volatile downward trend of international oil prices was the core factor behind the reduction in domestic refined oil retail prices. The decline in international oil prices was primarily influenced by multiple factors including Iraq's resumption of crude oil exports and developments in geopolitical conflicts. A relevant official from the Price Monitoring Center of the National Development and Reform Commission stated that first, the resumption of crude oil exports from Iraq's Kurdish region through Turkey has intensified concerns about crude oil oversupply. Second, geopolitical risk premiums in certain regions have also declined. Finally, increasing uncertainties in the external trade environment have further triggered market concerns about oil demand prospects. Although events such as OPEC+'s November production increase plans being lower than expected provided some support for international oil prices, overall, bearish factors for international oil prices were more significant.
The Price Monitoring Center of the National Development and Reform Commission believes that the global crude oil market will continue to maintain a loose supply pattern, and international oil prices will show a weak oscillating trend in the future, with changes in geopolitical situations amplifying international oil price volatility.
"In the short term, international oil prices may exhibit volatile oscillating movements, with the price center still having room to decline," said Gao Qingcui, a refined oil analyst at JLC Network Technology.