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Even China is sending a message to OPEC: Oil prices have fallen too far

 Gasoline demand in China increased 10.4 per cent in the first 10 months of the year from the same period of 2014, according to the Paris-based International Energy Agency.

The world’s biggest energy consumer may have a message for OPEC.

China’s decision to suspend fuel price cuts as crude continues its decline is sending a signal to the Organization of Petroleum Exporting Countries that prices are too low, according to a report from Sanford C. Bernstein & Co. The move gives oil a price floor around US$38, according to the analysis.

“China’s decision to not cut refined product (gasoline, diesel) prices is a first,” analysts including Neil Beveridge wrote in the report. The move “sends a signal to OPEC that its largest customer (China) believes that oil prices are too cheap.”

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