Diesel shortage spreads throughout the country

15:13, November 16, 2010      

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The diesel shortage in many provinces and cities has not been relieved. Instead, it is getting worse. According to Economic Information Daily, many institutions on Nov. 15 said the wholesale price of diesel continues to remain above 8,000 yuan a ton, with the price in some remote areas standing close to 10,000 yuan a ton. The wholesale price is dropping far away from the retail price.

"In only one or two weeks, the diesel shortage which was originally only in east and north China has already spread to the whole of China. Diesel prices across the country have increased generally, which has led to a phenomenon of high prices but no sales. The diesel price in some remote areas in southwest China and Sichuan has increased to 8 yuan a liter, equivalent to 9,500 yuan a ton," said Liao Kaishun, refined oil product analyst from C1 Energy Company.

Zhong Jian, chief analyst at oilgas.com.cn, said given the disparity between the wholesale price and the retail price, gas stations will lose money if they sell diesel. Some gas stations even lost more than 600 yuan a ton. Therefore, many gas stations have chosen not to sell or sell less diesel fuel. Almost all private gas stations have stopped supplying diesel because they cannot bear the losses.

Data released by the Petroleum Flow Committee under the China General Chamber of Commerce last week shows that over 2,000 private gas stations in southern China, mostly in Guangdong, Jiangsu, and Zhejiang provinces, have closed down due to the gas shortage. Liao said that at present, the actual number of private gas stations that have closed down is far beyond the current figure.

"Now, many gas stations only provide 100 to 400 yuan worth of diesel. Even though they can make more money, they will not supply more diesel than that. The diesel shortage in urban districts seems better but on expressways, many cars can be seen waiting for fuel. The severe phenomenon had only occurred once in 2008," Zhong said.

According to Economic Information Daily, there were many trucks waiting in long lines to refuel in front of gas stations in Yueyang, Zhuzhou and Xiangtan on the Hunan section of the Beijing-Zhuhai Expressway. Furthermore, vehicles waiting to refuel in front of gas stations in the urban districts of Changsha and Xiangtan extended all the way onto roadways, leading to serious traffic congestion in some sections.

By People's Daily Online


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