Rumors are afloat that the price of oil at the pump is going to increase once the Olympics have finished, thus ushering in the period of the ‘Olympic Hangover‘ The price of gas in China is now roughly $3.50, not far behind current US prices, but the below proposed prices push the price of a gallon, up, over, and far beyond what our American friends pay at the pump.
The rumors state that oil prices will rise as follows:
90# : 7.22rmb per litre (1.05USD litre)
93# : 7.91rmb per litre (1.15USD litre)
97# : 8.55rmb per litre (1.24USD litre)
These figures, if true, would give Chinese drivers a $5.24USD gallon if the average car uses 93# (as most mid range cars do) which is a far higher price than most American drivers are paying at the pump right now. Could it be that state owned operators are tired of making billions of dollars in losses per year and have finally pressured the government into raising the price of gas post Olympics.
As unpleasant as this will be for the motoring consumer in China, this will ALSO be a prime factor in seeing small cars (cars with a engine size of 1.5l or less) SKYROCKET in popularity. This is ALREADY happening in America…..I just read a news story about the Smart car (now being sold in America) and how there is a NINE MONTH waiting list to buy one right now. I hope Chery, Geely, Changan and other small car manufacturers are ready and prepared to meet the inevitable increased demand. I ALSO think that we’re going to see increased interest in hybrid/electric cars because of high gas prices……I think 2009 will be the year that these kinds of cars finally “come of age” here in China - and not a moment too soon!!
High gas prices suck but it’s a necessary evil. Hopefully the prices in the States rise to keep pace.Both countries need to innovate to get us away from non-renewable liquid fuels. Hopefully the silver lining in this price cloud is new, innovative transportation solutions.
Although I personally am not going to enjoy paying more at the pump I do think that it will be good to influence buying trends. There are way too many big cars out there. But, this is going to effect everybody here. One thing that I worry about is the crazy inflation that will follow. Going from $3.50gal to $5.24gal will jolt people. I’m not sure how the “laobaixing” get by as it is.
I’d be curious of what is the average income of a chinese car owner. I **suspect* that the average car owner in China probably makes more than an average American. Yes, you are comparing apples to oranges, but my point is that gasoline demand in China may be less elastic than gasoline demand in the US.
charlie,
I doubt that salaries of a chinese car owner are higher than an american car owner, but perhaps in china the disposable percentage of a salary is higher than well taxed Americans.
My Qashqai costs 400rmb to fill up to the top! My livina 200rmb, both go for a week with full tanks. Guess Ill have to stop speeding everywhere.
Im in England now, and pay 1.13GBP per litre.
This is only the start-be prepared for 10RMB / L prices soonish!
Where were the rumors founded? Can we get some source articles linked?
Rick,
Search Baidu news for the sources, there are plenty of sites talking about it!
Wow, yeah. It makes me want to ride a motorbike (like a yammy MT-03) even more. It’s so tempting to give it a shot, most of the police recognize me by now anyways, but after seeing your story on the destruction of confiscated bikes that puts a kabosh on that idea