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Diesel oil in short supply in south China
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Wholesale price increases for diesel oil have caused supplies to run low in several cities in southern China, the Shenzhen-based Sunshine Daily reported today.

Drivers of thirsty vehicles in Shenzhen, a city in Guangdong province, had to wait for long periods at several gas stations, because diesel oil suppliers had stopped delivering to many gas stations throughout the city. One driver told the newspaper that he stopped at more than 10 stations, but they all told him their supplies of diesel oil were sold-out.

The news report quoted an unidentified expert who said the shortages were a result of low retail prices for deisel oil that had failed to offset the impact brought by increases in its wholesale price.

The government raised the wholesale price of diesel oil from 6,500 yuan to 6,600 yuan per ton in March, but the market price was not raised accordingly. As a result, gas stations now must pay diesel wholesalers 5.60 yuan a liter, while they continue to sell the fuel to consumers at 5.28 yuan a liter.

Fears of oil price hikes loom large in China, because the international price of crude oil has surpassed 100 US dollars per barrel.

(CRI March 17, 2008)

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