OREANDA-NEWS. February 08, 2012. China Petrochemical Corporation (Sinopec Group), the country's largest petroleum company by sales, raised its refined oil factory prices nationwide at the beginning of the year, industry insiders confirmed with the Global Times.

The factory price of gasoline has been raised by 100 yuan (USD 15.86) to 8,280 yuan per ton, and that of diesel has been increased by 50 yuan to 7,380 yuan per ton, said Chen Qing, an analyst at industry information portal chem99.com.

Sinopec Group was not available for comment. An official of China National Petroleum Corporation (PetroChina), another domestic oil giant, told the Global Times on condition of anonymity that he had not received any information on an increase of oil factory prices.

"The price hike will slightly ease the losses of Sinopec's refining sector, but an increase of 100 yuan per ton is still not enough to fully cover the sector's losses," said chem99.com's Chen.

Sinopec and PetroChina announced total losses of 64.5 billion yuan in the first three quarters last year.

The country's refining sector has long been suffering from high costs as domestic refineries import a large part of their crude oil.

Chen said that private refineries are suffering even bigger losses, compared to big oil companies.

"Some private refining companies have followed suit by raising refined oil factory prices recently," said Wang Jintao, an analyst at Zibo Zhongyu Information Technology Co.

Wang noted that the increase in the factory prices is not likely to trigger a hike in the retail gasoline prices.

Domestic retail gasoline and diesel prices are currently adjusted by the National Development and Reform Commission if international oil prices fluctuate more than 4 percent over 22 consecutive working days.

Currently, international oil prices have changed some 3.2 percent over the past 22 working days, according to Wang, but the price level is not very likely to exceed the 4 percent requirement within this month.

Wang said that the government is very likely to come up with a new pricing scheme in the first half of this year that will shorten the adjustment period requirement to 10 days, a move aimed at reducing the gap between the domestic and international prices.

Lu Bin, an oil industry analyst at chem99.com, said that due to the ongoing conflict between Iran and the European Union, international oil prices are expected to further increase these days.