China can ensure energy supplies to power its fast growing economy despite oil shortages reported in some coastal areas as a result of surging oil price hikes in the world market, a senior economic official said on Friday.
"The country will definitely ensure the supply of oil products," Zhu Hongren, deputy department director in charge of economic operation under the National Development and Reform Commission (NDRC), told a press conference.
The production of refined oil products in China still meets demand despite regional shortfalls triggered by rising international prices, he said.
Zhu said the government would closely monitor domestic refined oil markets and take measures to secure the supply of refined oil products.
He added that the supply of coal - accounting for the lion's share of China's energy mix - can also be guaranteed in the winter.
The commission this week raised the prices of gasoline, diesel oil and aviation kerosene by 500 yuan (US$66) per ton, a rise of around 8 percent.
The average retail price of gasoline now stands at 5,980 yuan (US$800) per ton, and diesel is 5,520 yuan (US$740) per ton.
Zhu said that securing market supply of refined oil products would top the commission's agenda for the next two months.
He said that government departments were "actively" deliberating upon a pricing mechanism for refined oil products. "We need to take into account a number of factors to release the mechanism. Proper timing is necessary to avoid drastic fluctuations," he said.
To increase oil supplies and maintain domestic market stability, China National Petroleum Corporation (CNPC) and China Petroleum and Chemical Corporation (Sinopec) ordered their refineries to work at full capacity. CNPC pushed up its processed oil output by nearly 10 percent year-on-year in the third quarter.
Zhu said China should continue stemming rapid growth in high energy-consuming sectors and closing factories with excessive production capacity.
"We should strictly implement industry policy to stop new energy-hungry projects," said Zhu.
The government has already worked out plans to close factories in more than 10 energy-hungry industries including electricity, steel and iron, construction materials and coal mining, in order to meet its energy conservation targets.
In April, 344 steel and iron plants in 10 provinces were shut down as part of a program that will continue until 2010.
Xia Nong, deputy head of the commission's Industrial Policy Department, said at the news briefing that real estate posted the fastest gains in the first nine months, with its growth rate being 2 percentage points higher than that for the entire service sector.
The fixed asset investment of the service sector reached 4.28 trillion yuan (US$573.7 billion), representing an increase of 24 percent, 0.5 percentage points higher than the figure registered in the first half. Investment in the property market surged 30.3 percent to 1.68 trillion yuan (US$225.2 billion).
Housing prices in 70 large- and medium-sized cities rose by 8.9 percent year on year in September, hitting a new high despite the government's efforts to curb surging property prices.
(Xinhua News Agency November 3, 2007)
