Oil price hike on the international market may pose a potential threat to China's economy. Niu Li, a senior economist at the State Information Centre, said the price hike could drag down China's economic growth by at least 0.8 percentage point. A direct impact of the oil price rise was that China would have to pay extra money to import the same amount of oil as it planned. The price rise would also have an indirect impact on the economy. "Companies' profits will drop, while consumers will have to pay more for transportation" Niu said. The high oil price was a major reason for price rises in means of production and living materials, which have increased the likelihood of inflation.
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