CHINA'S leading refiner, Sinopec, yesterday refuted a media report that refiners in the country were stockpiling products amid increasing fuel shortages.
An industry report by the Shanghai-based information provider C1 Energy saying that some domestic oil enterprises were keeping ample reserves at a time of fuel shortages, was reported by yesterday's Shanghai Securities News.
Sinopec was not piling up oil products and was endeavoring to guarantee market supply, a Sinopec source, who declined to be named, said.
"These efforts included restructuring product mix to produce more oil products, diesel in particular, entrusting local refineries to turn out more products, continuing importing oil products and guarantee fuel demands in important agricultural provinces of Shandong, Hebei, Shanxi and Shaanxi," the source said.
John Chu, information director of C1 Energy, said that one reason for the fuel stock increase was that in recent months oil product supplies surpassed demand. The other reason was that Sinopec and PetroChina, as well as some independent wholesalers, were in control of fuel resources. Figures showed the country's apparent gasoline consumption (production volume plus net import volume) that stands for the basic supply level stood at 20.29 million tons from January to April, up 17.9 percent year on year. In contrast, the apparent diesel consumption reached 44.996 million tons in the same period, up 14.8 percent year on year.
However, Chu predicted the actual annual fuel demand growth in the first half of the year would hover between 6 to 7 percent, slightly higher than previous years, but far from the supply growth pace.
PetroChina and Sinopec vowed earlier this month to expand production, cut exports and increase imports to ensure the growing supply on the domestic market partly due to the after-quake reconstruction and summer demand.
These efforts would speed the domestic gasoline and diesel supply in the first half by 15 percent to 18 percent year on year, predicted the report. "The government should step up supervision of oil companies' reserves and urge them to sell stored products to ease fuel shortage," said the report.