Domestic refined oil product retail prices will undergo their 11th adjustment of the year, and second price cut, effective at 24:00 on June 4th.
According to an official announcement from the National Development and Reform Commission, following the previous domestic refined oil price adjustment on May 21st, international crude oil prices experienced volatile declines before a recent rebound. The average price over the 10 working days preceding this adjustment was lower than the average for the 10 working days before the last adjustment.
In line with changes in international oil prices, the retail prices for domestic gasoline and diesel (standard products) will be lowered by 525 yuan and 505 yuan per tonne, respectively, starting from 24:00 on June 4th.
Calculations indicate that after this adjustment, the price per liter for 92-octane gasoline, 95-octane gasoline, and 0-diesel will decrease by 0.41 yuan, 0.44 yuan, and 0.43 yuan, respectively.
Since the beginning of 2026, the domestic refined oil retail price ceiling has been adjusted 11 times, resulting in a pattern of "eight increases, two decreases, and one hold." Compared to the end of 2025, domestic gasoline and diesel prices have increased by 2055 yuan and 1980 yuan per tonne, respectively.
This price reduction will lower costs for private car owners and logistics companies. For a standard private vehicle with a 50-liter fuel tank, refilling with 50 liters of 92-octane gasoline will cost 20.5 yuan less after this adjustment.
It is noteworthy that, according to reports, several airlines including Air China have announced that aviation fuel surcharges for domestic flight tickets sold from 00:00 on June 5th will be reduced.
The new standard will be 80 yuan per flight segment for routes of 800 kilometers or less, and 150 yuan per flight segment for routes over 800 kilometers. The surcharge will be waived for infant passengers and halved for children, revolutionary disabled veterans, and people's police officers disabled in the line of duty.
Compared to the current standard, the surcharge for routes of 800 kilometers or less will be reduced by 10 yuan, and for routes over 800 kilometers by 20 yuan.
Domestic Wholesale Prices Continue to Weaken
During this pricing cycle, domestic refined oil demand has not shown significant improvement. Coupled with the impact of rainfall, which has further dampened demand, midstream and downstream industries have largely adopted a cautious and wait-and-see approach, resulting in subdued market activity and a continued weakening of domestic wholesale prices.
Entering June, international crude oil prices may decline. However, as domestic refineries are still primarily processing crude purchased earlier at higher prices, the cost side will continue to provide significant support to the domestic refined oil market.
An analyst from Longzhong Information noted that looking ahead, geopolitical uncertainties remain, but the market has largely returned to being demand-driven. The stimulus effect of crude oil on the refined oil market has weakened. With the demand side for domestic refined oil showing no short-term positive signs, and upstream industries still in a state of high costs and low profits, there is a possibility that refineries may further reduce operating rates, which could provide some support to product prices. It is anticipated that gasoline and diesel prices may still have room to decline, but the magnitude of the drop is expected to narrow.
An analyst from JLC pointed out that due to the continued weakness in wholesale prices, the spread between wholesale and retail prices for gasoline and diesel has remained high. Major gas stations have intensified promotional efforts to capture market share, with significant variations in discount levels among different types of stations.
Among them, major state-owned stations such as PetroChina and Sinopec strictly adhere to the national retail price ceiling. Their promotions are often tied to specific scenarios like membership top-ups, online payments, or member days. Nationwide, gasoline discounts typically range from 0.3 to 1.8 yuan per liter, and diesel discounts from 0.5 to 1.5 yuan per liter.
Private gas stations generally offer larger discounts, with nationwide gasoline price cuts commonly ranging from 1.0 to 2.5 yuan per liter and diesel discounts from 0.9 to 2.0 yuan per liter.
The proactive increase in discounts by major stations serves a dual purpose: to stimulate end-consumer demand and accelerate inventory turnover, and to preemptively mitigate the market risk of inventory devaluation following the official price adjustment.
Looking forward, international crude oil prices are likely to fluctuate within a high range due to geopolitical tensions. Expectations for a decline in the operating rates of both state-owned and independent refineries in China will provide a floor for wholesale gasoline and diesel prices.
However, following the implementation of this retail price ceiling cut, terminal retail prices will decrease correspondingly, potentially leading to a rapid narrowing of the wholesale-retail spread in the short term. Consequently, the overall profit margin for gas stations will be compressed, and the scale of promotional discounts offered by private stations is expected to contract significantly.
International Crude Market Sees Initial Decline Followed by Rebound
During the latest pricing cycle for domestic refined oil, international crude oil prices initially fell before rising.
Analysis from Longzhong Information indicates that on the supply side, improvements in navigation through the Strait of Hormuz remain limited. Crude production in Middle Eastern oil-producing countries continues to run at low levels, sustaining a supply gap.
On the demand side, conflicts in the Middle East continue to weigh on the global economy and oil consumption. Operating rates at refineries in several Asian nations remain low, and multiple institutions hold a pessimistic outlook for crude demand.
Looking ahead, there may be a turning point in geopolitical tensions. Overall, the probability of a price reduction in the next round of refined oil price adjustments is relatively high.
An analysis from the energy and chemicals team at Everbright Futures stated that looking at June, the core contradictions in the crude oil market require attention in several areas. First is the progress of US-Iran negotiations. Second is the evolution of inventory crises in countries with fragile reserves. Third is the potential impact of macroeconomic conditions and Federal Reserve policy. Fourth is the pace of supply recovery in the Middle East, which remains to be observed under conditions of extreme market reversal.
Therefore, overall, oil prices may continue their volatile pattern in June. Taking Brent crude futures as an example, the price fluctuation center is expected to be within the range of 90 to 110 US dollars per barrel.
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