China Refiners to Up Supply of Diesel
China’s economic planning agency said Tuesday it has ordered the country’s biggest oil refiners to ensure adequate supplies to regions hardest hit by fuel shortages, saying it expects the crisis to end soon.
Top leaders ordered state-owned China Petrochemical Corp., or Sinopec, and China National Petroleum Corp. on Nov. 24 to make every effort to ensure adequate supplies, especially in big cities, along key expressways and throughout regions where industrial production has been affected by fuel shortages, the National Development and Reform Commission said in a notice on its Web site.
The companies have also been instructed to cooperate with independent refiners in supplying crude oil and buying oil products, it said.
Refiners were told as well to reduce use of crude oil for petrochemicals and instead increase production of fuel.
The NDRC’s decision to spell out the wide range of measures taken suggests the problem is widespread enough to have caused alarm at the highest levels.
An almost 10 percent rise in the price of diesel and gasoline on Nov. 1 helped ease the pinch, but fuel is still so scarce in some areas that filling stations continue to ration supplies. In some cases, truckers, bus drivers and others have to wait for hours to tank up.
Both the NDRC and the Commerce Ministry have issued notices ordering crackdowns on price gouging, stockpiling and other abuses.
The notice said CNPC, parent company of PetroChina, had shipped 20,000 tons of diesel to Yunnan, in the southwest, while Sinopec had boosted supplies by 27 percent.
The areas worst affected by shortages include sugar-producing regions in Yunnan and neighboring Guangxi, in the south, and east China’s Zhejiang, which borders Shanghai, it said.
“Following these measures, the oil products supply market should very quickly return to normal,” it said.
China’s efforts to ease its fuel crunch have shaken regional markets.
The Asian spot market was rocked when Sinopec and PetroChina secured a three-year high of about 1 million tons (7.3 million barrels) of diesel for November-December delivery, according to Dow Jones Newswires.
Tags: CNPC, PetroChina, Petroleum, Sinopec
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