Petrol price rise fuelling rumours of conspiracies

Petrol prices remain controlled by the government. But this was the first price change after the introduction in May of a new "market-related" pricing mechanism.

It's a sort of formula. If the oil price moves more than 4% in 22 days, retail prices are adjusted. The size of the adjustment is related to allowed refinery profits. But it's all open to interpretation. The government gets the final say.

In this case there were special circumstances. The National Development and Reform Commission, responsible for many things in the Chinese economy, decided to limit the increase to 6% for petrol, which means that a litre now costs around 55p.

Not a lot for European motorists but a significant rise for many here, particularly at harvest time.

The NDRC was not just wary of snapping off a few green shoots by too big an increase. Its press release made references to certain countries stockpiling oil. With demand questionable and supply fairly constant, the finger was being pointed at speculation for recent dramatic price rises. This may not last.

Oil price volatility has been fertile ground for some colourful conspiracy theories. Still unused to being banker to the world, China can be sensitive about its new wealth. One vox-pop theory questions the wisdom of lending money to the United States so that it can stockpile oil, with the result that China ends up paying more for its energy.

Probably not on the agenda during US Treasury Secretary Timothy Geithner's visit last week.

* China's £400 billion stimulus package is not all government funded. State companies and banks are expected to do their bit. Figures for new lending show banks taking their responsibilities seriously. However, there's a growing suspicion that a fair chunk of this has ended up fuelling recent surges in stock market and property values.

* It's crayfish season in Shanghai. Formerly a rather downmarket dish due to its muddy origins, fish farming did a lot to clean up the image. They became fashionable. That was until the discovery that the squeaky clean appearance was caused by a liberal application of bleach. Crayfish are off the menu again.