AP News, December 18th, 2007
Drivers waited in lines up to a half-mile long to buy gasoline in China's mountainous southwest Tuesday amid rationing aimed at easing a fuel crunch in key export regions elsewhere.
Supplies began to run out Sunday in Yunnan province, triggering rationing, filling station employees and news reports said.
The crunch follows a diesel shortage in China's export-driven southeast in October and November that disrupted trucking and prompted the government to order suppliers to take emergency measures.
Fuel ran short in Yunnan after a pipeline used to deliver gasoline was switched to carrying diesel in response to the shortage, the state Xinhua News Agency said. The pipeline is owned by China's biggest refiner, China Petroleum & Chemical Corp., or Sinopec.
The shortages have highlighted China's soaring fuel consumption amid economic growth that is expected to top 11 percent this year and growing automobile ownership.
"Now we do not have enough fuel to sell to customers," said an employee contacted by phone at a Sinopec filling station in Kunming, the Yunnan provincial capital.
The station limited customers to buying $40 worth of fuel, said the employee, who refused to give his name. At another Sinopec station in Kunming, an employee said the line of waiting cars stretched for a half-mile.
Trucks and buses were unaffected because Yunnan had adequate supplies of diesel, the employees said.
Supplies were expected to be restored in two to three days, Xinhua said, citing Xi Limei, an official in charge of commodities distribution for Kunming, the Yunnan provincial capital.
Phone calls to the Kunming offices of Sinopec and CNPC were not answered.
There were no reports of similar shortages in other regions and no indication of an immediate economic impact.
Yunnan, which borders Vietnam and Myanmar, is a popular tourist destination but has little industry.
Chinese oil producers have blamed the shortages on government controls that prevent them from passing on record-high global crude prices to consumers. Many processors have responded by cutting production in order to avoid losses.
Sinopec and China's biggest oil company, China National Petroleum Corp., have imported several hundred thousand barrels of diesel to ease the shortage in the southeast. They also have promised to reconfigure refineries to produce more diesel.
Regulators raised gasoline and diesel prices by nearly 10 percent in November to curb demand but economists expect Beijing to keep controls in place in order to shield China's poor majority from high oil prices.
The diesel shortages in Guangdong province in the southeast eased at the end of November, said filling station employees.
"We have no lines and area offering unlimited supplies to customers. There are enough supplies of both gasoline and diesel," said an employee of the Liwang Gas Station in Guangzhou, the country's southern business capital. He would give only his surname, Wang.
Sinopec and CNPC have asked for government approval to increase gasoline supplies to Yunnan next month to meet rising demand, the local Communist Party newspaper Kunming Daily reported.
