LONDON (Commodity Online): China has already reported diesel shortages throughout the country, with domestic refineries significantly ramping up production to meet the domestic shortfalls, said Barclays Capital in a research note.
Diesel is in tight supply nationwide, especially in the country’s northern, eastern and central regions. A large number of private gas stations are, in fact, out of feedstock, bank added.
According to a recent survey conducted by market research firm C1Energy on the country’s 300 private gas stations and 350 gas stations run by state-owed oil companies, only 51% of private gas stations and 77% of state-owned ones could ensure diesel supply.
Nearly 16% of private stations and 16% of state-owned ones set limits on the quantity of diesel each driver could buy. Moreover, PetroChina and Sinopec have completely suspended wholesale diesel sales in East China’s Jiangxi Province while in other eastern provinces, wholesale diesel sales have been suspended in order to ensure retail sales.
According to Barclaays in central China’s Hubei Province, Sinopec’s wholesale diesel sale is limited, while PetroChina’s wholesale diesel sale is almost suspended with less than 100 tonnes provided each day to Wuhan, the capital city of Hubei. If the country experiences a bitter winter, then these shortages are likely to get magnified in the coming months.
