The oil industry is extremely important to China＇s overall economic growth, fiscal stability and international trade. But oil industry reforms have been undertaken slowly and gradually. In 1994 the government reimposed central control over its oil industry by fixing the price of crude and petroleum products, and channelling virtually all sales through state agencies, This move marks a temporary retreat from the ongoing experiment with oil deregulation, which picked up speed since 1992. For as long as it lasts, this renewed central recontrol over oil prices and distribution will create increased uncertainty for foreign participation.