Fuel Shortages In China Becoming More Acute....

Not only is electric power in short supply causing brownouts and forced service interruptions, but gasoline is also in short supply.

The Guangzhou-based newspaper Information Times reported Wednesday that Guangzhou and its neighboring cities in the Pearl River Delta will face increasing pressure of fuel shortage in the coming months.

Reporters visited gas stations throughout the city and the neighboring cities including Dongguan, Panyu, Shunde.

Staff from most of the gas stations in Guangzhou claimed shortage of 90-octane grade gasoline. Even sales of ample 93-octane grade gasoline are limited by quotas.

There is a market based reason why oil now trades at over US$60 per barrel, demand in the growing world economies is greatly outstripping supply. Additionally, there are probably severe bottlenecks in the supply chain that will become more obvious and painful as time wears on. I am no expert on China's oil supply, but in addition to strains on importing the raw material of oil, there must be strains on refining and distribution capacity that the young semi-market based economy that modern China is, is grappling with.