"It is nothing more than a bowl of noodles to me," said a driver
with the Jinjiang Taxi Company in Shanghai after learning that
petrol prices had dropped slightly on Tuesday morning.
Like millions of the nation's drivers, news of small savings at
the pumps was met with a mixture of indifference and disdain.
Driving an average 400-kilometres every day, the cabbie uses
about 40 liters of petrol. The price drop of 90-octane petrol from
3.66 yuan (44 US cents) per liter to 3.54 yuan (39 US cents) could
help him save 5 yuan (60 US cents) a day -- the price of a bowl of
"It means nothing important to me," the driver said, who shares
the car with a colleague. The pair leases the car from the cab
company for 12,000 yuan (US$1,449) a month. Each earns about 3,000
to 4,000 yuan (US$362-483) a month.
In real terms, savings as a result of the price reduction will
be nominal. In Shanghai, the price of 93-octane petrol fell from
3.98 yuan (48 US cents) per liter to 3.85 (46 US cents), and in
Beijing it fell from 3.92 yuan (47 US cents) to 3.79 (45.5 US
Feng Jianhai, manager of Sinopec's Refueling
Station on the Chengdu North Road in downtown Shanghai, agreed that
the price difference was minimal.
"A number of taxi drivers waited at the gate until midnight when
the price was due to change, but not that many," Feng said.
"Consumers are numb now from frequent price upswings."
His station sells about 40 tons of gasoline a day. But he said
the price of liquefied petroleum gas is also expected to drop
"Judging from experience, gas prices will run parallel with that
of petrol," Feng said, adding that the drop would probably also be
"The indifference to the price drop is understandable, as most
consumption in Shanghai involves public vehicles," said Wang Qihua,
a senior official with Sinochem Shanghai.
In Beijing, where according to statistics from the end of last
year, about half of the city's 2.6 million vehicles are privately
owned, the price cut came as good news.
Even so, a nationwide survey of at least 20,000 people by
sina.com.cn indicated that an overwhelming majority thought petrol
prices in China are still higher than they should be.
About two-thirds of those surveyed said the current price drop
is simply a reaction to international price fluctuations. They said
they also expect diesel prices, which have been steadily rising in
China, to go down.
After the government had raised the price of petrol by 300 yuan
(US$35) a ton in March, Tuesday's price cut surprised many oil
"We did not expect the government to adjust prices so quickly,"
said one market observer. "The government is concerned the oil
price hike may induce inflation."
Chinese oil companies will have to bear the brunt of the price
cut, which will further squeeze their profits. Oil refining
companies were already struggling after the government refused to
allow them to pass the effects of the last hike in crude oil prices
on to consumers.
(China Daily May 25, 2005)