The Guangzhou-based newspaper Information Times reported on Wednesday that Guangzhou and its neighboring Dongguan, Panyu and Shunde cities will face the increasing pressure of fuel shortages in the coming months.

Staff from most of the gas stations in Guangzhou claimed quotas have been imposed on the sale of 90-octane grade gasoline, and even 93-octane grade gasoline, which is in more ample supply.

At some gas stations, drivers can only buy 50 yuan worth of 90-octane gasoline at a time.

In Panyu, only a few stations continue to supply 90-octane gasoline.

Guangzhou, the capital of south China's Guangdong Province, has a reported monthly shortfall of about 50,000 tons of refined oil, Xie Zhaowei, secretary of Guangzhou Petrol Industry Association, said on Thursday.

Xie added that the shortage has begun to affect people's lives.

One member of staff from a Sinopec gas station said that the shortage was linked to Typhoon Haitang. Oil tankers could not dock on schedule.

Another reason is that prices of domestic fuels are lower than international prices, which has curbed domestic production output. Some gas stations have stopped supplying 90-grade gasoline as owners claim they're losing money on it.

A sales manager from Sinopec said that Guangzhou needs 80,000 tons of fuel oil each month, which is still insufficient to cover the shortfall of about 30,000 tons. PetroChina, another heavyweight supplier in the city, covers about 20,000 tons of the shortfall.

Skyrocketing prices of crude have produced a shortage in China, and now domestic refineries are reluctant to increase production, Han Xuegong, senior analyst for China National Petroleum Corp, said on the sidelines of a petrochemical industry summit yesterday.

Other problems, Han said, include China's large consumption of energy, a result of its fast-growing economy, and the rising demand for refined oil by the domestic market.

"Asia's largest oil refiner Sinopec relies on imports for much of its crude for refining, so the surging crude prices on the world market have greatly hurt the oil giant's refining business, especially since the central government controls domestic prices keep the market stable," Han said.

(China Daily, CRI August 5, 2005)