Exports leave China with no oil at home

In addition to the hurricane-lashed Gulf of Mexico, China is grappling with oil shortages of its own making.

Demand for gasoline and diesel in China is propelled by the market, as factories expand and cars proliferate, yet the state controls retail prices to limit inflation.

This has encouraged China’s oil firms to export all they can to take advantage of higher prices elsewhere, even as the country remains a net oil importer, relying on foreign stocks for about one-third of its consumption.

In the first seven months of the year, China’s exports of oil products like gasoline leapt by more than 45 per cent. Crude oil exports jumped by nearly 30 per cent, even as Chinese companies search the globe for new sources as part of a state-mandated energy-security initiative. ‘‘Our firms want to export to make dollars, so we don’t have any oil,’’ said Huang Caixin, a sales representative at Zhipeng Ceramics Co., which makes bathroom and kitchen tiles.

“We’re cutting production, and our profits are down. Almost every factory here is running at less-than-full capacity.’’ Seeking to plug the gap, the government on September 1 announced that oil firms could not sign new export contracts. —LATWP