China reforms jet fuel pricing

China will adjust jet fuel prices once a month starting August, in an attempt to align domestic prices with global prices. “The revamped jet fuel pricing is one big step towards a market-oriented system,” the National Development and Reform Commission (NDRC), China’s macroeconomic planning body, said. “It’s also an experiment for reforming China’s refined fuel market.” Under the new scheme, the ex-refinery price will be linked to Singapore spot quotes for the previous month, plus a negotiated premium. This development came shortly after Beijing reduced the import duty for aviation fuel to zero. China Aviation Oil (CAO), a unit of China National Aviation Fuel Company (CNAF), which controls the bulk of the country’s aviation fuel supply infrastructure, said that the move will incentivize local refiners to produce more jet fuel, Reuters said. (July 12,2011)