Diesel in Short Supply
By LAN XINZHEN
【期刊名称】北京周报（英文版） 【年(卷),期】2010(053)047 【总页数】2 【
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https://www.zhangqiaokeyan.com/academic-journal-cn_beijing-
review_thesis/0201210943324.html
Frequent diesel oil shortages necessitate the need to revamp pricing mechanisms and break up oil monopolies
Li An has made many journeys from Xinzhou, Shanxi Province, to Beijing on the expressway. The trips have been too numerous, much like his cargo of potatoes that will be sold at the Xinfadi Farm Produce Wholesale Market in the Chinese capital city. Recently, Li has run into problems that could threaten his trucking excursions to Beijing and across China.
Since October, diesel oil shortages that started in south China have spread north and west, with many gas stations low on or completely lacking diesel oil. To fi ll his tank, Li often has had to visit fi ve or six gas stations.“Without a full tank, we dare not run the truck,” he said. According to figures released by the Petroleum Circulation Committee (PCC) of the China General Chamber of Commerce,by November 12 this year, more than 5,000 privately owned gas stations had run out of diesel
fuel and 80 percent of state-owned gas stations had limited the amount of fuel customers could buy.
This isn’t the fi rst major diesel oil shortage to plague China. In the past decade, such shortages have happened every one or two years. But this shortage sets itself apart from previous ones, and while it may not impose a serious impact on the Chinese economy,it has sounded the alarm from the country’s energy mechanism.
Behind the shortage
This year, the blame for the lack of diesel falls on some local government measures to limit electricity use in parts of China.
Five years ago, the Chinese Government set a target that by 2010 the energy consumption per unit of GDP would be reduced by 20 percent of 2005 levels. The decision was passed down to all provinciallevel governments under the stipulation that government officials in these areas would be held responsible if the targets were not reached.
As the deadline quickly approaches, local officials are scrambling to save energy and reduce emissions, and one of the ways they’re doing so is to limit electricity supplies.
Zhong Yongsheng, Deputy Director of the Center for China’s Urban-Rural Development Studies, said because of the rush limit of electricity, many enterprises have had to generate electricity by themselves using diesel oil. And so the shortage began.
Furthering the dilemma was the fact that many oil refineries often perform maintenance work on equipment in July and August when oil consumption is usually low. This year, however, output decreased just as demand was increasing.
“The reduction of diesel oil output and limits on electricity supplies jointly caused the shortage of diesel oil, directly and indirectly,” Zhong said.
Liu Feng, a petroleum industry analyst with Shandong Zhuochuang Information Co.Ltd., said this year the diesel oil shortages mainly hit south China, especially the southeast coastal area, which was directly related to the limit of electricity supply by some local governments. The unexpected limit has increased the country’s demand for diesel oil by at least 100,000 tons.
Zhao Youshan, PCC Chairman, thinks some branches of China National Petroleum Corp. (CNPC) and China Petroleum and Chemical Corp. (Sinopec) have jointly directed the diesel oil shortage this time. The two state-owned oil giants, as the country’s biggest re fi ned oil suppliers, have monopolized the Chinese oil market.
During negotiations with the branches of the two oil giants, Zhao became familiar with their policies and practices. He said he eventually found out these branches had oil in their depots, but had stopped oil wholesale to other gas stations and were only supplying their own gas
Diesel in Short Supply
