Oil giants to boost supply
Updated: 2007-11-21 10:11
China National Petroleum Corp (CNPC), the nation's largest oil company, yesterday announced it would import 100,000 tons of diesel this month to stabilize domestic supplies.
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In order to further stabilize the supply of refined oil products, especially diesel, CNPC will "take several measures to increase the manufacturing and supply". The company is running its refining units at full capacity and processing more crude oil than planned, according to its website.
CNPC would also increase its imports to further boost supply. By mid-November, it had imported more than 400,000 tons of oil products, the company said.
China's largest oil refiner China Petroleum & Chemical Corp - also known as Sinopec - also plans to increase output and imports to meet a shortfall in domestic supplies. It has unveiled a 10-step program, which includes near-record diesel imports, higher output for December and delayed maintenance work at five plants, the company said on Monday.
The oil giant has ordered subsidiaries to work at full capacity to refine 42 million tons of crude oil in the fourth quarter and to refine 200,000 additional tons in December.
It planned to increase diesel production in November by cutting aviation fuel output by 80,000 tons. Despite losses, Sinopec would continue to import 200,000 tons of diesel in December after importing 277,000 tons of refined oil this month.
Sinopec will delay maintenance on five refineries to ensure fuel supplies. The refineries are the Yangzi plant in Jiangsu Province, the Jinan facility in Shandong Province, the Zhenhai refinery in Zhejiang Province, the Jiujiang refinery in Jiangxi Province and the Hainan refinery in Hainan Province.
The Chinese government would closely monitor domestic refined oil markets and take measures to secure the supply of refined oil products, an official with the National Development and Reform Commission told China Daily earlier.
Analysts said the government should reform the oil pricing mechanism to reflect the international oil price hikes in a bid to boost the oil giants.
China, the world's second largest oil consumer after the United States, increased fuel prices by as much as 10 percent from November 1 to boost market supply.
Prices of gasoline, diesel and jet fuel rose 500 yuan a ton to temper consumption and help refiners cover costs.
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