GULF OIL, an international oil company which opened its first gas station in Yuexiu district of Guangzhou on Sept 8, sold gas for 5.26 yuan ($0.76) a liter on the first day, compared with 7.56 yuan a liter nationwide. Thepaper.cn comments:

Many drivers waited in a long line at the station to get gas. And although the promotion lasted just one day, it has raised hopes that oil prices could be lowered in the country.

The entry of Gulf Oil into the Chinese market is a result of the further opening-up of China's gas retail sector.

Previously, foreign oil companies that wanted to do business in China had to form a joint venture with a Chinese company, with the latter controlling the majority share if their number of gas stations exceeded 30. But this year's negative list on foreign investment, jointly issued by the National Development and Reform Commission and the Ministry of Commerce on June 28, scrapped that clause.

The new negative list came into effect on July 28, enabling Gulf Oil to open its first branch in Guangzhou, South China's Guangdong province.

With the US Federal Reserve raising interest rates, emerging market economies have been facing increasing pressure of capital outflow. The further opening-up of China is expected to counterbalance part of the negative effects. In fact, in Guangdong province alone, apart from Gulf Oil, other oil giants such as US-based Exxon Mobil and Germany-based BASF have also signed investment contracts which add up to about $10 billion.

That's good news for ordinary residents because the competition between the two domestic oil giants and foreign companies could result in better services and lower oil prices. It's good news for the Chinese economy, too, because fair competition will add vitality to the market.