Crude Oil Surge Leads to Significant Increase in This Round of Retail Fuel Prices in China

March 9th, news:

The latest round of adjustments to China's refined oil prices took effect at 24:00 on March 9. The retail price of refined oil will see a significant increase. In 2026, the retail price of refined oil in China has experienced four increases, zero decreases, and one suspension. During this cycle, crude oil prices have surged, and the positive change rate of crude oil has widened, leading to an imminent "four consecutive increases" in the retail price of refined oil.

As we enter this pricing cycle, international oil prices have surged dramatically. As of the 6th, NYMEX crude oil futures led the rally, with the actively traded April crude oil contract settling at $90.90 per barrel, and the May Brent crude oil futures settling at $92.69 per barrel—marking the sixth consecutive trading day of gains. The increase in crude oil prices during this round has reached as high as 30%. Throughout this pricing cycle, crude oil prices have risen sharply. The recent surge in oil prices began around March 1, when the U.S. and Israel launched attacks on Iran, prompting Iran to retaliate by blocking oil tankers from passing through the Strait of Hormuz, thereby directly triggering panic in the global crude oil market. The conflict has now spread to key energy-producing regions in the Middle East, disrupting local oil production and forcing refineries and liquefied natural gas plants to halt operations. In particular, on the evening of March 7, Iranian oil storage facilities were attacked, severely damaging its oil storage and transportation capabilities and further driving up oil prices. Overall, crude oil prices have experienced a sharp upward trend this cycle. As of the 9th, the 10th working day, the change rate for crude oil varieties reached 11.10%, corresponding to an increase of 695 CNY per ton for gasoline and 670 CNY per ton for diesel in China. Converted into per-liter prices, this translates to an increase of 0.53 yuan per liter for No. 92 gasoline, 0.56 yuan per liter for No. 95 gasoline, and 0.57 yuan per liter for No. 0 diesel.

Gasoline: Due to disruptions in crude oil transportation and contract cancellations, refineries such as Zhejiang Petrochemical, CNOOC Shell, and Hainan Refining are considering reducing production, with some refineries suspending orders and tightening plans. Shandong independent refineries have collectively raised prices, with spot prices surging rapidly. Additionally, with China's refined oil inventories at a low level, and the seasonal inventory of refined oil in China being relatively low, the supply tightening has further tightened the liquidity of spot goods, supporting the strengthening of prices. However, recent resident travel and other activities have been normal, and the increasing popularity of new energy vehicles has led to weaker-than-expected demand. Despite this, gasoline prices have risen significantly due to the boost from crude oil.

Diesel: Recently, the supply of diesel in the Chinese market has slightly decreased, while demand is picking up due to the start of spring plowing and the recovery of logistics. Construction sites and projects across China are gradually resuming work, leading to a steady increase in the demand for diesel. The willingness of downstream buyers to purchase has increased, resulting in a short-term tight supply-demand situation, and the diesel market has significantly risen.

Looking ahead: The key factors in this situation lie in the specific magnitude and duration of the supply disruption, as well as subsequent policy changes, including OPEC production adjustments and the release of U.S. reserve inventories. If the conflict in the Middle East persists for a long time, it will not only lead to a continuous rise in oil prices but also exacerbate global inflationary pressures, thereby dragging down global economic growth. Subsequent attention should be paid to the progress of U.S.-Iran events, the navigation situation in the Strait of Hormuz, and the actual implementation of OPEC's production increase plans. For China, in the short term, the operating rates of refineries are expected to decline, leading to a reduction in the supply of refined oil products, and it is anticipated that the prices of gasoline and diesel will continue to rise.