By Stacy Boit,

China has dialled back on planned fuel price hikes in a bid to reduce the burden on drivers, as energy costs surge amid the Iran war.

The local price of petrol has jumped by about 20% since the start of the conflict, which has seen Iran effectively close one of the world’s busiest oil shipping channels, the Strait of Hormuz.

Gasoline and diesel prices were initially set to rise by 2,205 yuan (£239; $320) and 2,120 yuan per tonne respectively – but after government adjustments, the increases will be nearly halved to 1,160 yuan and 1,115 yuan, starting Tuesday.

More than 300 million people in China drive cars that run on petrol or diesel, with Gulf countries a major source of the country’s oil.

Long queues of cars had formed outside petrol stations in multiple Chinese cities over the weekend, with some stations having to post notices that they had run out of fuel.

The latest price hike was the country’s fifth and largest of the year so far – even with the reduction.

The price of Brent crude oil jumped above $100 a barrel – a day after prices plunged, as conflicting accounts of potential talks between US and Iran emerged.

Beijing has over the years taken advantage of lower crude prices and the abundance of supply from Gulf states to build one of the world’s biggest oil reserves, Ole Hansen, Saxo Bank’s head of commodity strategy, told the BBC last week.

In January and February of this year, Beijing bought 16% more crude compared to the same time period a year earlier, according to its customs administration.

Iran, whose oil is sanctioned by the US, has been a key supplier of cheap crude for China, with reports suggesting that Beijing buys more than 80% of Iran’s oil exports.

Hansen said that estimates show China has built up reserves of around 900 million barrels – just under three months’ worth of imports. Figures from Columbia University, cited by Chinese state media, said China had petrol reserves of some 1.4 billion barrels.

Despite its reserves, Beijing has shown signs of caution to manage its supplies in the short-term.

Authorities in China reportedly ordered its oil refineries to temporarily cease fuel exports, in an attempt to keep domestic prices under control. China’s government did not respond to BBC queries on the matter.

Barrels from Saudi Arabia and Iran account for more than 10% of its imports each, according to the US Energy Information Administration (EIA).

“To mitigate the impact of abnormal increases in international oil prices, ease the burden on downstream users and ensure stable economic operations and public welfare, temporary regulatory measures have been adopted,” China’s state planner said in a statement on Monday.

The price hikes were implemented by the National Development and Reform Commission (NDRC), which reviews petrol and diesel prices every 10 days and adjusts based on global prices of crude oil.

By Stacy Boit,

Australia and the European Union have agreed a sweeping free trade deal after eight years of negotiations.

The deal, worth about A$10bn ($7bn; £5.2bn), was signed on Tuesday with Australia’s prime minister and the head of the European Commission describing it as a mutual “win-win”.

As well as removing almost all tariffs on trade, the two have also agreed to increase co-operation on defence and critical minerals.

European Commission President Ursula von der Leyen described the deals as having a focus on “collective resilience” in a world that is “deeply changing”.

“A world where great powers are using tariffs as leverage and supply chains as vulnerabilities to be exploited in our story,” she said – a nod to US President Donald Trump’s use of tariffs, as well as China’s control of the critical minerals market.

She added that “trust matters more than transactions”, noting Australia and the EU had a “unique relationship” that was “built for the long term”.

Under the deal, almost all EU tariffs will be lifted on Australian agricultural products such as wine, fruit and vegetables, olive oil, seafood, most dairy products and wheat and barley. This will mean a saving of about A$37m for local wine producers and exporters, the government said.

For Australian consumers, the deal will mean cheaper European wine, spirits, biscuits, chocolates and pasta.

The deal means Italian-style sparkling wine made in Australia can still be sold as prosecco domestically, though the name will be phased out over 10 years for exports.

Australian producers can also continue to use names including parmesan though feta will be subject to “grandfathering and lengthy phase-out periods”. The issue of food naming rights is sensitive in both Europe and Australia is now the only country outside of Italy to have secured EU permission to use the name prosecco.

Referring to the matter, Australian Prime Minister Anthony Albanese noted the country’s modern history was built on migrants.

“That’s why whether it’s Greeks coming here and creating feta, or Italians coming and doing parmesan or people from Eastern Europe doing kransky sausages – it’s a connection with Europe.”

The trade agreement was a perfect balance, von der Leyen said, as it will be easier for Australians to export to the EU while more EU-made goods will be available in Australia.

But Andrew McDonald from Meat and Livestock Australia said the deal on meat exports was not a fair outcome for Australian farmers who had wanted an annual quota of at least 50,000 tonnes – the deal allows for about 30,000 tonnes, up from 3,389.

“This is unquestionably a missed opportunity for Australia’s red meat producers, processors and exporters,” he said.

The new security and defence partnership will see greater co-operation in the defence industry, counter terrorism, space and maritime security. Von der Leyen also announced greater co-operation on several critical mineral’s projects between Australia and the EU, including lithium and tungsten.