OREANDA-NEWS. July 06, 2011. CHINA won't launch a reform on the pricing of natural gas within this year mainly due to inflation concerns, Economic Information Daily reported, quoting an unidentified authoritative source.

Currently, natural gas price is set by the government and there lacks of a clear mechanism linking prices to market supply and demand. Big domestic natural gas producers are facing mounting losses from selling imported gas below costs, the Beijing-based newspaper said.

Almost 20 percent of the natural gas used in China relies on imports, according to the report. A market-based system is set to boost natural gas prices in China, worsening inflation in the country, it said.

As China has already raised power prices and may again hike oil prices this year, there is little room left for authorities to conduct the natural-gas-pricing reform, the newspaper said.