China Orders Oil Producers to Increase Diesel Output

The Chinese Ministry of Commerce has instructed oil producers to increase diesel output to meet the higher demand for the fuel, during the spring sowing season, according to Reuters.

The ministry has issued notices to the country’s major oil companies including China Petrochemical Corporation, China National Offshore Oil Corporation and China National Petroleum Corporation, to boost production of diesel volumes.

The news source noted that the Chinese ministry’s order coincides with the difficult fuel supply situation in the country. The Chinese government is seeking to reign in food price inflation by ensuring optimal harvests.

China’s demand for oil products reportedly increased by 6.2% in the first quarter of 2008, primarily due to a tax discount on imported fuels intended to help mitigate the losses borne by refiners.