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Fuel brawl in Henan province


In 2007 China, the world’s most populous nation boasted a population of more than 1.3 billion1 people. In that year, its economy grew at a rate of 11.4%2, representing one the fastest growing economies in the world.

The energy requirements required to feed China’s rapidly growing economy have been exceptionally high. The purchase of these has been aided by the countries’ distorted market which has kept fuel costs artificially low.

The backdrop

Fuel shortages first hit China in 20053, whereby scarcity of fuel affected southern Chinese provinces, such as Guangzhou, as well as Zhejiang and Shanghai, in the country’s east. These shortages were attributed to transportation disruptions, along with government price controls.

The escalation pathway

In 2007, fuel shortages were widespread across China. These shortages were a result of price controls on fuel, regulated by the federal government in Beijing. As world oil prices were climbing, Chinese refiners were prohibited from increasing the costs to consumers accordingly. Consequently, Chinese oil companies were reticent to increase production, as this would only serve to exacerbate the companies’ losses.

State owned enterprises such as Sinopec needed to absorb significant financial losses, which Beijing sought to offset by providing annual payouts. Independent refiners, on the other hand, attempted to limit losses by trimming their processing rates and cutting flows to markets – subsequently tightening supplies of diesel and other fuel.

At this time, China had refused to increase fuel prices for almost 1.5 years, owing to fears that doing so would trigger civil unrest and push up inflation. China’s diesel prices, for example, were far lower than other nations’ with one litre costing just 64 cents in Beijing, compared to $1 in Singapore and $2 in Britain4.

In late 2007, some gas stations in China had closed, while others boasted long queues. Shortages had spread throughout the country, with fuel rationed or unavailable in Shanghai, along with central Chinese provinces of Anhui, Hunan and Hubei, as well as Beijing. Lack of fuel led to rationing at some filling stations, causing lengthy queues of potential customers to form. With customers forced to wait for hours for an unreliable fuel supply, tensions rose and tempers frayed.

The event

In October 2007, one man was killed in a brawl that took place in a service station queue, in the central Chinese province of Henan. A customer having jumped the queue reportedly triggered this fight.

Early intervention

  • The government could have implemented an acceptable steady increase of fuel costs on the consumer, to avoid the building of tension over time.
    • The government could incentivise such an increase by offering tax reductions to the people.
  • Better communication between independent refiners and the government to resolve issues of financial loss – to avoid the need for a 'silent protest' in pressuring the government.
  • Better fuel distribution methods by the government to mitigate pressure that was building in certain hotspots.
  • Service stations identified as pressure hotspots could have been provided with government security to:
    • ensure a peaceful state of order is maintained (queueing)
    • mitigate the potential outbreak of violence.

Key themes

Fuel shortages, queuing, government, subsidies, unrest.


  1. Bai, J. and Shen, R., 2007. China fuel crisis spreads. [online] Available at https://www.reuters.com/article/us-china-oil-shortages-idUSPEK16644320071031 (accessed 30 May 2019).
  2. Griffiths, D., 2007. China’s fuel dilemma. [online] Available at https://news.bbc.co.uk/1/hi/world/asia-pacific/7075044.stm (accessed 30 May 2019).
  3. Lin, B., Ouyang, X., 2014. A revisit of fossil-fuel subsidies in China: challenges and opportunities for energy price reform. Energy Conversion and Management, 82, pp124-134.
  4. Petroleum Economist, 2005. China: Fuel shortages prompt re-think on oil pricing. [online] Available at https://www.petroleum-economist.com/articles/politics-economics/asia-pacific/2005/china-fuel-shortages-prompt-re-think-on-oil-pricing (accessed 30 May 2019).
  5. Ruwitch, J., 2007. Price controls lead to fuel shortages in China. [online] Available at https://www.nytimes.com/2007/10/01/business/worldbusiness/01iht-yuan.1.7696184.html (accessed 30 May 2019).
  6. Wikipedia, 2019. Economy of China. [online] Available at https://en.wikipedia.org/wiki/Economy_of_China (accessed 13 September 2019).
  7. https://countryeconomy.com/demography/population/china?year=2007.
  8. https://www.ft.com/content/a136b73e-d5a1-11dc-8b56-0000779fd2ac.
  9. https://www.reuters.com/article/idUSPEK166443.
  10. Calgary Herald, 2007. China fuel crisis deepens: gas station death puts pressure on Beijing to act (accessed through dropbox link)


Fuel brawl in Henan province - PDF