Some gas stations are limiting diesel sales as the nationwide fuel
shortage starts to hit Shanghai.
Soaring crude oil prices are starting to have a big impact at a
local level, as oil companies say they are doing their best to
An employee at a Sinopec petrol station near Lujiazui, Pudong,
said many services stations uptown had been rationing diesel, with
each vehicle only getting a quarter, or less, of its tank filled,
Most Shanghai pump stations selling diesel are located outside
Buses owned by travel agencies could be most affected while
public buses should be immune as public transport operators usually
sign long-term purchase contracts.
"Diesel supply is tight in town now as the shortage spreads,"
said Lu Xiangrong, a media relations official at Sinopec Shanghai
"But we will allocate more supply to address the situation in
Fuel shortages were reported throughout China over the weekend,
from southern Guangdong and Fujian to eastern Zhejiang and central
Henan. Industry sources said the tight supply could last for
The supply squeeze is due mainly to the surging world crude
prices, which are making refineries in China unprofitable as
domestic retail fuel prices are set by the government to check
A similar rationing was reported in booming Guangdong in 2003,
with long queues at many pump stations.
Crude rose above US$93 per barrel for the first time yesterday
in New York, and Gordon Kwan, Hong Kong-based analyst at brokerage
CLSA Ltd, expects it could reach US$100 in coming days.
It is understood refineries choose to shut down some refining
capacity for maintenance while crude costs are high. Sinopec is the
largest refiner in Asia. According to a Reuters report, Sinopec is
seeking another 60,000 tons of diesel imports for November after
having bought the same volume in October, which will take its
imports to an 11-month high to meet the gap.
(Shanghai Daily October 30, 2007)