China likely to lower oil price

BEIJING -- China will probably cut domestic guide prices for gasoline and diesel due to drops in global crude prices.

Retail prices will be reduced by over 100 yuan (around $16) per tons, according to Xinhua's oil price system. If confirmed, it would be the first cut since the end of March and the fourth this year.

An announcement from the National Development and Reform Commission, China's top economic regulator, is expected Monday. According to China's oil pricing mechanism, the price can be changed every 10 working days should there be a substantial change in the global market price.

Crude prices fell last week, weighed on concerns of oversupply after the Organization of the Petroleum Exporting Countries (OPEC) decided to keep it daily output at 30 million barrels for the next six months.

On Saturday, Brent recovered to around $63 a barrel after falling for three consecutive days, but still lower than more than $65 seen on June 2.

Crude prices have been on rising since January's bottom, ending a six-month-long plunge from $105 a year ago.

However, the possibility of a downturn can not be ruled out due to OPEC's decision, an upcoming meeting of the US Federal Reserve and Iran's nuclear issue, Li Yan, analyst from Oilchem.net said.