By Zheng Caixiong (China Daily)
Updated: 2007-11-02 11:09

Guangdong's government is encouraging more local and foreign oil companies to enter the province's finished oil circulation market.

The move aims to secure sufficient supply of finished oil and curb price fluctuation in the country's biggest oil-consuming province.

According to sources from the Guangdong Provincial Economic and Trade Commission (GETC), the southern Chinese province will build 139 new filling stations in major cities in the Pearl River Delta in the fourth quarter of the year.

The GETC is expecting more big-name local and foreign oil companies to open new filling stations in the prosperous province.

Statistics from the Guangdong Oil and Gas Association show the province consumed more than 20 million tons of diesel oil and gasoline in 2006 - more than one-eighth of the country's total.

This year's oil consumption is expected to be higher than last year's figure due to the province's rapid economic growth and the sharp increase of vehicles since the beginning of the year.

Many filling stations have seen brisk business since the beginning of the year, with long queues throughout the day.

Guangdong's reserves of finished oil could support the province only for a few days without deliveries from elsewhere, sources with the Guangdong Oil and Gas Association said.

Insiders predict the short supply of finished oil will last at least one month in Guangdong.

Guangdong opened 601 filling stations between January and September this year, said GETC sources. Of them, 462 were launched in the three months ending September.

The province plans to build about 2,250 new filling stations during the 11th Five-Year Plan period (2006-10) to meet growing demand for diesel oil and gasoline.

The province has more than 5,000 filling stations in service.

Most are located in the prosperous cities of Guangzhou, Foshan, Shenzhen, Zhuhai, Zhongshan, Jiangmen, Dongguan, Qingyuan, Zhanjiang, Shaoguan, Maoming, Huizhou, Zhaoqing, Shantou and Yangjiang.