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CHINA is running out of fuel. Police are guarding petrol stations in several inland provinces to prevent fights, as shortages of petrol and diesel are
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CHINA is running out of fuel. Police are guarding petrol stations in several inland provinces to prevent fights, as shortages of petrol and diesel are causing huge queues of trucks, buses and cars.
In Kunming, capital of the southwestern province of Yunnan, 1000 trucks are stranded.
A truck driver named Li told the Chuncheng Evening News he had been stranded at the Stone Tiger Gate petrol station for three days after searching for fuel in other places, but failing. He said his delivery date was way overdue.
Another driver, at Geiju city, said a job that would have taken one day in the past, now took three: one on the road, two queuing for fuel.
Nine days ago, a truck driver was reported to have been stabbed to death in central Anhui province after a row about queuing.
A few days earlier, at Ezhou in Hubei province, 100,000 people were stranded, unable to get to work, because city buses had run out of fuel.
Beijing has been insulated from the headache, and the wealthy coastal provinces are mostly better stocked, because the refineries are nearby.
The problem would intensify as winter approached, and was starting to affect exports, warned the Commerce Ministry, since diesel was crucial for shifting products to ports.
The system is suffering from pressure of demand to sustain its economic growth at the current 11.5per cent - with China now the second-biggest consumer of oil after the US.
Diesel imports rose 46.5per cent in the first nine months of the year, compared with the same period last year.
The other cause of the supply-demand mismatch, is the stuttering transition from government-controlled prices to market pricing.
The Government wishes to graduate towards a system that allows prices to move with international markets.
But inflation is at a 10-year high of 6.5per cent and the Government is reluctant to let oil, a key input for distribution of all products, float free as yet.
The two companies that dominate petrol and diesel sales, Sinopec and PetroChina, are state-controlled but also listed on stock markets, highly competitive, and anxious to become even more market-driven. Both pledged this week to boost their imports, especially diesel.
As inflation began to accelerate this year, the Government announced it was capping the prices of key commodities it still controlled, including oil, until the end of the year.
But it relented under strong pressure from Sinopec, PetroChina and other oil refiners and distributors, and conceded a 10per cent rise from this month.
Even after the 10 per cent rise, the price remains well beyond international levels, and China has to import about half its oil, for which it must pay world prices.
[link to www.theaustralian.news.com.au]
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