“Following the rapid growth in car ownership, automobile emissions are having an increasing impact on air pollution,” the central government said in a statement posted on its website late Wednesday.
The powerful State Council, or cabinet, mandated that sulphur content for both petrol and diesel would be set at no more than 10 parts per million (ppm) by 2017, a reduction from the current 50 ppm, according to the statement.
Burning fuel with sulphur produces sulphur dioxide, a major air pollutant.
The Chinese capital Beijing has already started to implement the new standard but other cities will have a “grace period” until the end of 2017, the official Xinhua news agency said separately.
“The timetable shows that China will step up its pace to upgrade gas quality,” Wang Zhen, deputy head of the China Energy Strategy Research Institute at the China University of Petroleum, was quoted by Xinhua as saying.
Beijing and vast swathes of northern China were covered by a toxic haze several times in January, sparking anger online and prompting unusually outspoken calls for action, even from state-run media.
The pollution has been blamed on emissions from coal burning in power stations but also exhaust fumes from vehicles on traffic-clogged streets.
Chinese car ownership has exploded as rapid economic growth produces greater wealth. The country is now the world’s largest auto market with an estimated 240 million motor vehicles on the road, official figures show.
A top official of Chinese oil giant Sinopec said last week that the company would sell oil products meeting higher environmental standards by the end of 2014 after upgrading its refineries.
Ratings agency Moody’s said in a report on Thursday that the government might offer Sinopec fiscal support to offset the cost of the upgrades, which oil companies have reportedly resisted.
Cleaner fuel could also mean higher prices at the pump, state media said. The National Business Daily quoted experts as saying fuel prices could rise three percent as a result of the higher standard.
The government fears higher fuel prices could cause social discontent, as high petrol costs have been a factor in strikes by taxi drivers in the past.