30 Jun 2010 10:06

BREAKING NEWS: Shanghai to raise commercial gas prices by $0.049 per cubic meter

Shanghai. June 30. INTERFAX-CHINA - Shanghai Municipality will raise commercial gas prices by RMB 0.39 ($0.049) per cubic meter beginning July 1, an analyst told Interfax at an industry forum on June 29.

Wang Jiamei, an oil and gas analyst with C1 Energy Ltd., said that the Shanghai Municipal Development and Reform Commission decided on the price hike during an internal meeting on June 29, but has yet to officially announce the decision on its website.

Additionally, the commission decided to postpone increasing residential gas prices until after the conclusion of the World Expo in late October, said Wang.

Shanghai's decision to raise commercial gas prices is the first by a local authority after the National Development and Reform Commission (NDRC) increased the ex-work price of gas on June 1 by RMB 0.23 ($0.029) per cubic meter.

Chi Guojing, secretary general of the China Gas Association, told Interfax on June 29 that the NDRC is requiring local authorities to adjust commercial gas prices, but to hold off on raising residential prices after the recent ex-work price hike.

According to Chi, because only 30 percent of the country's gas consumption comes from the residential sector, there is no hurry to raise residential prices.

"Energy prices in all sectors have been rising in recent years," Chi said. "The recent gas price hike is relatively moderate for commercial consumers." He said that while the increase may add to operating pressures on industrial consumers, most should be able to endure it.