China’s diesel exports in August surged from a year earlier and have nearly tripled so far in 2023 compared to the same time a year ago, data showed on September 18, as refiners take advantage of strong regional refining margins to ship fuel overseas.
Exports of diesel, the biggest fuel by share of refinery output, last month totaled 1.26 million metric tons, up 51.5% from last year’s 830,000 tons, data from the General Administration of Customs showed.
Total diesel exports for the first eight months of the year are up 197.2% versus the same period in 2022.
Domestic diesel demand has seen only muted growth amid deepening tumult in the property sector and contracting exports, pushing refiners to shift their output overseas.
Gasoline exports were up 23.7% to 1.38 million tons from 1.12 million tons in August last year.
Domestic demand for gasoline was anticipated to be high through August because of a pick-up in road traffic over the summer travel period, the first since 2019 not to be disrupted by COVID-19 containment measures.
Jet fuel exports were 1.55 million tons, up 98.1% from 780,000 tons a year earlier. Domestic flight capacity by available seats was up by about 17% from pre-pandemic levels in August 2019, while capacity on international flights in and out of China remained at around 49% of pre-pandemic levels, according to data from aviation analytics firm OAG.
Sales of jet fuel for outbound international flights are included in this export figure.
China’s surging fuel exports have coincided with monthly refinery throughput rising to a record 15.23 million bpd in August.
Total fuel exports, including marine bunker fuel, in August were up 23.3% from last year at 5.89 million tons, customs data showed earlier this month.
Profit margins for Asian refiners <DUB-SIN-REF> continued their upward trend through August to end the month at about $12.60 a barrel, the highest since late January and up around $2 a barrel from July.
“High oil prices and high stocks should prompt China to import less crude and petroleum products in the period ahead particularly for inventory refill purposes, and to export more petroleum products,” analysts from Citi wrote in a client note.
Authorities issued a long-awaited third batch of product export quotas at the start of September, comprising 12 million tons for refined fuels such as gasoline and kerosene and 3 million tons for marine fuel.
The data released on September 18 also showed China imported 6.30 million tons of liquefied natural gas (LNG) in August, up 34.1% from last year’s 4.72 million tons.
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