Beginning on Jan. 1, the import duty for fuel oil, of which China is Asia’s largest buyer, will be kept at the same rate of 3 percent, the ministry said in a statement on its Web site, www.mof.gov.cn.

The oil products tax cuts, last made in November 2006 from previous rates at 5-6 percent, came along with more drastic cuts in metals import duty and increases in export tariffs for steel products, as Beijing sought to reduce its record trade surplus and also to curb energy-intensive investment.

The cuts on diesel import duty come just days after Beijing decided to waive its 17 percent value-added tax on diesel fuel imports between December and March to help the world’s second-largest oil user cope with domestic shortage.

‘It’s certainly favourable for imports. But the final economics will depend on global oil markets, transportation cost versus the controlled domestic market,’ said one state trader.

Chinese state oil firms Sinopec Corp and PetroChina had shunned imports of the key transportation fuel until November, as the business incurred losses with import costs surging while domestic rates rigidly capped.

They finally raised the purchases in the last couple of months to near peak levels after the country suffered through a serious diesel shortage.

The ministry set the import duty for naphtha, a feedstock for petrochemicals, at 1 percent for next year and kept the fuel oil import duty at the same rate of 3 percent.

It also extended a 5 percent export duty for crude oil. Crude exports in the first 11 months of this year dropped 41 percent over a year earlier to 3.2 million tonnes, official data showed, as Beijing diverted more supplies to the thirsty domestic market.