This Round of Retail Oil Prices Achieves "Five Consecutive Increases"

March 23 news

The current round of China's refined oil price adjustment window opened at 24:00 on March 23. The retail price of refined oil in this round will be significantly increased. In 2026, the retail price of refined oil in China will see five increases, zero decreases, and one suspension. During this cycle, the crude oil market has risen, and the positive change rate of crude oil has widened. The retail price of refined oil is about to experience a "five consecutive increases."

Entering this pricing cycle, international oil prices have risen. As of the 20th, the settlement price for the May contract of U.S. WTI crude oil futures stood at $98.23 per barrel, while Brent crude oil futures also increased, with the May contract settling at $112.19 per barrel. Throughout this pricing cycle, crude oil prices have continued to climb. The U.S.-Iran conflict shows no signs of easing; the Strait of Hormuz remains blocked, allowing only a limited number of ships to pass through. Oil-producing countries such as Saudi Arabia have already been forced to cut production. Supply risks continue to mount, providing ongoing support for oil prices. Meanwhile, global demand remains weak, and there are concerns that escalating geopolitical tensions could weigh on the economy and oil consumption. Moreover, the Federal Reserve is unlikely to cut interest rates in the short term. Overall, crude oil prices have trended upward during this cycle. As of the 23rd, the 10th working day, the rate of change for crude oil varieties reached 30.10%, corresponding to an increase of approximately 2,200 CNY per ton for gasoline and diesel in China. Converted into per-liter prices, this translates to an increase of 1.73 yuan per liter for No. 92 gasoline, 1.83 yuan per liter for No. 95 gasoline, and 1.87 yuan per liter for No. 0 diesel. However, the Chinese government has implemented temporary regulatory measures on refined oil prices, resulting in actual adjustments of 1,160 yuan and 1,115 CNY per ton for gasoline and diesel, respectively, after the regulation was applied.

Gasoline: Due to disruptions in crude oil transportation and the cancellation of long-term contracts, some refineries are considering reducing production, while also suspending orders and tightening plans. Shandong independent refineries have collectively raised prices, with spot prices surging rapidly. Additionally, with China's finished oil inventories at a seasonally low level, the supply tightening has further constrained spot liquidity, supporting price increases. However, recent activities such as resident travel have been normal, and the increasing popularity of new energy vehicles has led to lower-than-expected demand. Despite this, gasoline prices have risen significantly due to the boost from crude oil.

In the diesel market: Recently, the supply of diesel in China has decreased, while demand has started to pick up due to the beginning of spring plowing and the recovery of logistics. Construction sites and projects across China are gradually resuming work, leading to a steady increase in diesel demand. The willingness of downstream buyers to purchase has increased, resulting in a short-term tight supply and demand situation, which has led to a significant rise in the diesel market.

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 U.S. releasing its reserve inventory. 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. It is necessary to continue monitoring the developments of the U.S.-Iran situation, the navigation conditions of the Strait of Hormuz, and the actual implementation effects of OPEC's production increase plans. In China, the short-term refinery operating rates are expected to decline, leading to a reduction in refined oil supply. It is anticipated that the prices of gasoline and diesel will continue to rise in the future.