Gulf Oil station restores regular pricing without govt intervention

By Zhang Hui Source:Global Times Published: 2018/9/14 23:03:40

The US-based Gulf Oil's gasoline station in Guangzhou, South China's Guangdong Province, which attracted local consumers to its cheaper prices on Thursday, has sparked public discussions on the global oil companies' prospects in China. 

The oil prices returned to normal on Friday, three days after it offered 5.26 yuan ($0.77) per liter, which was 1.6 yuan cheaper per liter than what was being offered by China's two State-owned giants, China National Petroleum Corporation (CNPC) and Sinopec.

The Guangzhou Municipal Development and Reform Commission said Friday that the city's price administrators did not impose any measures on the gas station's change in prices amid speculations that the government forced the gas station to adjust its prices, according to the website of the commission.

Qiu Wenjie, marketing manager of the China branch of Gulf Oil, told the Global Times that the price reduction was just a promotion, and the company plans to open 1,000 gas stations in China.

The incident has triggered online discussions on whether foreign oil companies could compete with China's State-owned companies.

Chinese netizens hailed the entrance of foreign oil companies on China's Twitter-like Weibo on Friday, and many called for the company to quickly expand into their hometowns after learning of the reduced prices.

But some remain pessimistic about the prospects of foreign oil companies, as they believe that with the same oil price, foreign companies cannot compete with China's State-owned giants.

A Guangzhou resident working in the coal industry surnamed Huang told the Global Times that global oil companies entering China was a good thing, as it could help improve the service of gas stations in China.

"I choose gas stations depending on their location, and I will not go to the Gulf Oil station unless it's cheaper, but it seems that Gulf Oil is not allowed to offer a cheaper price in China," Huang said.

Gulf Oil, with 117 years of history, joined other global oil companies such as BP and Shell as China loosened investment restrictions on foreign-owned gasoline stations.

Lin Boqiang, director of Xiamen University's China Center for Energy Economics Research, said that even if global oil companies cannot offer a cheaper price, they could still compete with their Chinese counterparts with their history and respected brands.

"With the continued growth of China's auto market, the world's largest, more global oil companies will enter China and compete with their Chinese counterpart - which is good for Chinese consumers," Lin told the Global Times.

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