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FUEL TROUBLES COMMENTS * China - Economy is Running Out of Gas… Literally
Pekin,China -All Roads Lead to China.com (CAL,USA) -Oct 31, 2007: -- Last week, the China Auto Times printed a story (see our's "TROUBLES with FUEL * China - Gas Shortage in Shangai -29 Oct 2007": below) that China was considering a 100% gas tax that would raise the price of petro from 2.50USD a gallon to 5USD a gallon. It was a story I had planned on commenting on, but no one else picked it up... What makes this most interesting is that it appears to be (1) widespread across China and (2) it is affecting big customers... Why these two things are important are that one of the big incentives the oil firms offered for logistics firms (trucking, shipping, etc) and retail pump owners to sign on for big contracts was a guaranteed supply.. or at the minimum a spot at the front of the line... 
This is not the first gas-out China has experienced, but it is one of the most wide spread since they made the leap from exporter to 2nd largest importer a few years back... These stories should serve as warning shot, and that everyone needs to plan for increased transportation costs and also understand that China’s reliance on gas is going to be a natural constraint to the growth of the economy... China has already raised prices 10% across the board according to the WSJ, and it is only a matter of time before that goes higher (consider the fact that we are not in peak season for ANYTHING right now)... (Read herein too: "Jay Boyle Says: China could save an inordinate amount of fuel if: ..." -November 1st, 2007 -)Labels: fuel troubles
posted by Unknown @ 7:18 AM
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