Soaring global oil prices have hit supplies of oil products, especially diesel, in some parts of China.
"Wholesale prices of major oil products, especially diesel, and low-end gasoline products have risen to some extent. But the real headache is that even with rising prices, there is still not enough supply," said Yao Daming, an official with the Guangdong Oil and Gas Association.
Statistics from oilboss.cn, an oil retail information portal, show wholesale prices of oil products have risen by less than 100 yuan per ton for low-end gasoline and above 100 yuan for diesel. This price surge and tight supply has hit several areas, oilboss.cn data show.
"In Guangdong, with low inventory and expectations that the authorities may raise retail prices, the supply is really tight," Yao said, predicting the shortage will continue till the end of this year and early next year as demand for diesel picks up further and supply drops.
Retail prices of major oil products are tightly controlled by top economic planner the National Development and Reform Commission (NDRC) as they are seen as major components of inflation.
Niu Li, an economist with the State Information Center, affiliated to the NDRC, contended that given the current consumer price index (CPI), there is a possibility the authorities will raise local oil prices in line with the global crude levels.
The CPI eased slightly to 6.2 percent in September after surging to an 11-year monthly high of 6.5 percent in August.
New York's main futures contracts, light sweet crude for delivery in November, hit a record $90.07 a barrel last Friday.
(China Daily October 25, 2007)
