China to cut fuel prices in line with world market

China, the world's second-biggest oil consumer, said Wednesday it would cut fuel prices by more than three percent, following a retreat in global crude costs and amid concerns over inflation. The National Development and Reform Commission (NDRC) -- China's powerful state planner -- said the benchmark price for petrol would fall 3.6 percent, or 330 yuan ($52.4), to 8,850 yuan a tonne from Thursday. The diesel price will drop 3.7 percent, or 310 yuan, to 8,020 yuan per tonne, it said in a statement. The NDRC said the move -- which marks the first fuel price cut since October -- reflected changes in the current international market. The commission can adjust fuel prices when international oil prices move by more than four percent over a 22-working day period. China last adjusted fuel prices in March, hiking prices by the biggest margin in nearly three years after a surge in the cost of global crude. The latest move could have positive implications for government attempts to control inflation, amid concern surging prices could spark social unrest. The nation's inflation rate edged up to 3.6 percent in March from 3.2 percent in February, driven by both rising food and fuel costs. Official inflation data for April is due to be released on Friday. The share prices of China's energy giants fell on Wednesday ahead of the move, which is expected to hurt their profits. PetroChina fell 2.01 percent to 9.73 yuan while Sinopec lost 1.93 percent to 7.11 yuan in trading on the Shanghai stock exchange.