Due to fuel shortages, China has rationed diesel

Image credit: Bloomberg.com

In many places in China, petrol stations have begun limiting diesel due to rising costs and dwindling supply.

Some truck drivers are having to wait days for refills, according to postings on the social media site Weibo.

China is currently experiencing a huge power shortfall as a result of coal and natural gas shortages, which have forced enterprises to close and people to go without power.

Analysts believe that this latest issue will only add to the ongoing global supply chain turmoil.

The present diesel shortages appear to be harming long-distance transportation operations, which may include items destined for markets outside of China, Mattie Bekink, China Director at the Economist Intelligence Unit, said.

“We could see this contributing to global supply chain difficulties depending on the duration and intensity of this crunch.”

The Covid-19 pandemic has been a major driver of the worldwide supply chain crisis, with demand growing as economies reopen. Trucks in China are only allowed to fill up to 100 litres each, or roughly 10% of their capacity, according to a truck trader from Shijiazhuang, Hebei province.

According to accounts, rationing is considerably tighter in some regions of the country, with vehicles only able to purchase up to 25 litres.

Meanwhile, Caixin says that gas stations in Fuyang, around a seven-hour journey south of the main transportation hub of Shijiazhuang, are limiting purchases or charging vehicles up to 300 yuan ($47, £34) to fill up their tanks.

In recent weeks, oil prices have risen to their highest levels since 2014, exacerbating fuel shortages in regions like Europe and the United Kingdom.

Part of this is due to coal and natural gas shortages in countries like China and India, which researchers anticipate will lead to a shift to oil as a source of electricity and heat. This demand might result in an increase of more than half a million barrels of oil per day in global crude consumption.

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