BEIJING –(Oilnews)- Oil products smuggled to overseas is the main reason of southern China’s oil products shortage, Xinhua quoted Li Rongrong, director of State-owned Assets Supervision and Administration Commission of the State Council, as saying.

The volume of oil products which is smuggled to overseas is about 1200 tons per day, since oil products price in Hong Kong is about 3 times higher than in mainland, Li added.

Li denied the rumor that oil products shortage in southern China is caused by state-owned oil companies which threaten the government for higher oil products retail price. 

State-owned oil companies like Sinopec and PetroChina have lost profit of 46 billion yuan in the first half of this year because of the price difference between mainland and overseas, said Li.

“Why we still need to threaten the government for higher retail price if we have already taken the profit loss of 46 billion yuan?”, said Li.

Soaring demand in driving season and transportation suspended by typhoon are also factors of oil products shortage in southern China lately, Li added.