Global oil prices have been high because of tensions with key supplier Iran.
The move is aimed at ensuring domestic fuel supplies and to help local refiners cut heavy losses.
Analysts said this was a sign the government is less concerned about inflation.
Rising prices have been a problem in China since the global financial crisis led authorities to introduce a stimulus package.
Consumer price inflation peaked in July last year at 6.5% before easing.
In February, the rate of inflation was 3.4% from a year earlier, which is below the government’s target of 4%.
High prices, especially of food and fuel, have previously led to unrest in Chinese cities.
Under China’s fuel-pricing system, domestic fuel prices can be adjusted when a basket of international crude changes by more than 4% over a period of 22 days.