Beijing, March 23 China has increased retail fuel prices as part of preparations for a fuel crisis amid concerns that the US-Israel-Iran war may prolong, leading to shortages of gasoline and diesel.
China's top planning body, the National Development and Reform Commission (NDRC), has announced temporary measures starting from Tuesday in response to rising international oil prices.
The measures are aimed at mitigating the impact of the abnormal rise in international oil prices, reducing the burden on downstream users, and ensuring stable economic operation and social well-being, the NDRC said.
Accordingly, gasoline and diesel prices will increase by 1,160 yuan (approximately USD 168) and 1,115 yuan per tonne (USD 159), respectively, according to the NDRC statement.
China reportedly has about four months of emergency reserves.
Following the announcement of the fuel price hike, vehicle owners rushed to gas stations across China to fill their vehicles' tanks.
The conflict in West Asia has led to the blockade of the Strait of Hormuz, a key shipping route through which 20 per cent of the world's energy is transported.
China relies on imports for about 70 per cent of its crude oil, with roughly 45 per cent of imports linked to flows through the Strait of Hormuz, implying that about 30 per cent of the country's total oil supply is exposed to disruptions in the Strait.
"China's energy consumption and power generation mix suggest that it is less vulnerable to energy supply shortages from disruptions in the Strait of Hormuz than most major economies and its Asian peers," said Andrew Tilton, a China economics analyst at Goldman Sachs in Hong Kong, to the South China Morning Post.
China has both gas pipelines connected through its borders with Russia and has a long-term energy supply contract with Moscow.
