Rationing of Diesel in China Amid Fuel Shortage

The petrol stations located in multiple areas across China have started to ration large amounts of diesel amid the rising global costs and fuel shortages experienced throughout the world. Some of the truck drivers currently have to wait entire days to be able to refuel their vehicles, according to several social media posts on site Weibo.

The country of China is in the midst of an enormous power crunch, as there is a global fuel shortage, including gas and coal, which have resulted in the temporary closure of factories, and numerous residences have been left without any power supply.

And the most recent issue of fuel shortage throughout the globe is expected to further contribute to the ongoing global crisis of the supply chain.

Fuel shortage affecting supply chain

According to the China Director, Mattie Bekinik at the Economist Intelligence Unit stated that the diesel fuel shortage that is currently affecting the transportation process of long-distance businesses, which could possibly include goods that are meant to markets located outside of China. The challenges that are likely to occur due to the challenges faced in the global disruption of the supply chain depend on the intensity and duration of China’s power crunch.

The global crisis of supply chain has majorly occurred due to the onset of the coronavirus pandemic, as the demands have reached a rapid surge as the economies around the world had reopened as the overall number of cases of the viral disease declined.

In the country of China, the good heavy vehicles are only allowed to fill up to 100 liters each, which is only around 10% of their total capacity, according to the truck driver working in the city of Shijiazhuang located in the province of Hebei.

In some other parts of the nation, several reports have been received which suggest that the rations of fuel due to global fuel shortage have become even tighter, as drivers are only allowed to buy 25 liters during a single purchase.

Meanwhile, in the Fuyang city, which is around a seven-hour drive in the southern direction of the key transportation hub located in the city of Shijiazhuang, it has been reported by Caixin, a Chinese business news service, that limitations on purchases have been placed on petrol station, or in some cases, the stations are charging the extra amount of up to 300 yuan ($47) to completely fill the tanks of the heavy goods vehicles.

One truck driver wrote in a post found on social media platform Weibo stating that after he went to several petrol stations, he was unable to find any diesel to fill up his vehicle, while the prices for fuel continued to rise, and numerous large capacity trucks that are used to run logistics are unable to refuel on time due to excessive fuel shortage.

He further added that he is getting the feeling that even after the pandemic, the prices for food products continue to become expensive, and the process of express delivery has become drastically slow. It would be better for the general population of China to buy fewer number of products during the 11/11 sale, which is referred to as the Single’s Day sale by Alibaba, which is typically one of the biggest days of the entire year in the shopping calendar in China, due to excessive discounts on products.

Coal shortage of China

The diesel shortage across China has become the most recent issue after the persisting shortage of coal. All of the fossil fuels have recently seen an increase in prices lately as the underinvestment in the sources of fuel have created a fuel shortage during the time when the demand is at a peak.

The prices of coal, gas, and oil have all moved in tandem and are currently at a major high.

The prices of oil have hit the highest record level since the year 2014 in the past recent few weeks, which has caused the crisis of fuel shortage in places including the United Kingdom and Europe. Part of the crisis is a major driver by the shortage in natural gas and coal in countries like India and China, which according to the prediction made by analysts that users are most likely to switch to oil for heating and generation of power.

Such an amount of demand could help boost the overall consumption of crude by more than half a million barrels of oil in a single day.

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