The Chinese government has confirmed that dozens of rescue boats are at sea trying to control the fire, as the oil tanker continues to burn for the third day.
The Sanchi was carrying almost one million barrels of condensate - a type of gassy, ultra-light oil - when it collided on Saturday evening with a freighter 160 miles from Shanghai and caught fire.
Photos on the Chinese Ministry of Transportation's microblog showed thick black smoke pouring from the ship on Thursday morning.
China's ministry of transport said rescue vessels withdrew to a safe distance after the explosion on the Sanchi's bow, the latest setback in the multinational effort to extinguish the burning wreck and find more than 30 missing crewmembers.
Since then, the Panama-registered tanker Sanchi has been ablaze and drifting in the waters between Shanghai and southern Japan.
Experts are especially anxious because the ship is carrying condensate, an ultralight version of crude oil.
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"Contaminated air from fire and bad weather have increased difficulties of rescue work", the ministry said.
China's largest patrol ship Haixun 01 is fighting the fire after the explosion while organising other vessels to move away, the ministry said.
South Korean authorities have said that the flames could last for up to a month given the consequences of previous oil spills.
The front section of an Iranian oil tanker that has been on fire for days off the east China coast has exploded, forcing rescue boats searching for 31 missing sailors to retreat and sparking environmental concerns.
"The problem is the ship's heavy bunker fuel", said Chauncey Naylor, a US -based director of emergency response and training at Tyco Corp's oil-fire specialists Williams Fire & Hazard Control, which is not involved in the clean-up.
A simulation test also found that less than one per cent of oil content would remain on the sea surface five hours after a condensate oil leak.
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