The State Administration of Taxation announced a plan to levy a tax on petroleum refining consumption starting Jan. 1, 2013.

The announcement stated that all liquid oil products will be subject to the tax, with one yuan per liter for naphtha and 0.8 yuan per liter for fuel oil.

Some institute analysis shows that the consumption tax may stimulate a price bounce of adjustable chemical raw materials. Asphalt has been sold in Shandong province to escape taxes, but now the government may have more standard treatment of the material since it can be used for adjustable oil products.

Other materials including MTBE, aromatic hydrocarbon, mixed aromatic, C5 and C9 will all be levied by one yuan per liter.

Figures show that factories producing adjustable oil products have a large demand for the materials above. In 2011, 1.9 million tons of mixed aromatic was imported, and it's forecast that the imported mixed aromatic will exceed 20 million tons this year, and this may bring 2.35 billion yuan of fiscal revenue after the tax is levied.

Though the policy may bring a short bounce in the chemical materials market. The policy aims to boost the production cost for adjustable oil producers, and possibly stabilizing the state monopoly of PetroChina and Sinopec.

According to local reports, adjustable oil producers are concentrated in Shandong and other southern provinces. In Dongying, a small city near Shengli oilfield in Shandong province, there are about 100 adjustable oil producers.

The added cost will finally transferred to the oil station, according to a manager at a station, with the price of adjustable oil increasing 500 to 1500 yuan per ton.