China expects 12.4% drop in fuel exports in November

China is expected to cut fuel exports by 12.4% in November to protect profits from rising domestic demand, a move that has had a major impact on fuel markets.

China is expected to cut refined oil products by 12.4% in November, according to the latest survey by OilChem, in a move to adjust supply amid falling refining margins and rising domestic demand.

Specifically, China's total fuel exports in November are forecast to reach 2.54 million tons, including 800,000 tons of gasoline, 180,000 tons of diesel and 1.56 million tons of kerosene. Although gasoline exports increased by 3.9% compared to October, diesel exports are expected to fall sharply by 28%, while kerosene is expected to fall by 18% compared to the previous month.

Chinese refiners are cutting their oil processing rates as production costs rise and profits take a hit. Total fuel exports in September were 5.2 million tonnes, down 4.5% year-on-year. Of this, gasoline exports fell a sharp 33% to 730,000 tonnes, while diesel exports were down 350,000 tonnes, down both year-on-year and month-on-month. In contrast, jet fuel exports were the only increase, up 11.8% year-on-year.

China is expected to cut refined oil exports by 12.4% in November to protect profits from rising domestic demand, which could hit fuel markets hard.

The drop in exports reflects the pressure from declining refinery margins, according to a report from ING analysts. Refinery operating rates fell 10% in August to 12.6 million barrels per day, as refineries sought to limit production to preserve profits. Instead, they built up inventories, with the pace of stockpiling reaching its highest level since 2015, around 3.2 million barrels per day.

Earlier this month, the Chinese government issued a fourth-quarter fuel export quota of 9 million tons, including 8 million tons of clean refined fuels and 1 million tons of marine fuels. The bulk of the quota was allocated to major state-owned companies such as Sinopec, CNPC and CNOOC, in order to ensure adequate domestic supply and adjust inventory levels.

With this new batch of quotas, China's total fuel export quota in 2024 will reach 54 million tons, almost unchanged from 2023. This shows that despite the decrease in export volume, China still maintains its plan to distribute fuel to the international market, but with a more cautious strategy.

Chinese refiners’ margins are under pressure as production costs rise, while export demand declines and domestic demand shows signs of picking up. Analysts say the export curbs may be part of a longer-term strategy to increase product value and protect profits.

In that context, China's proactive adjustment of export quotas and domestic fuel storage is an important step, not only helping to preserve profits but also ensuring national energy security when domestic demand is forecast to continue to increase in the coming months.

According to experts, this move from China could have a major impact on the global fuel market, especially when Asian and European countries are struggling to maintain stable supplies. The reduction in gasoline, diesel and kerosene exports from China could cause world fuel prices to fluctuate in the coming time.

https://oilprice.com/Latest-Energy-News/World-News/China-Plans-to-Export-124-Less-Fuel-in-November.htmlChina plans to cut fuel exports by 12.4% in NovemberChina plans to cut refined oil exports by 12.4% in November to protect domestic demand

Source: https://congthuong.vn/trung-quoc-du-kien-giam-124-xuat-khau-nhien-lieu-trong-thang-11-355750.html