China’s refiners have suspended fuel exports indefinitely, according to Reuters, citing several sources familiar with the matter on Thursday.
PetroChina, one of the country’s state-owned energy giants, has reportedly cancelled several gasoline and jet fuel shipments scheduled for October, the sources said.
China curbed fuel exports during the spring and early summer to safeguard domestic supplies amid disruptions linked to the Strait of Hormuz crisis. Most of those restrictions were lifted by mid-July, enabling refiners to increase overseas shipments and help alleviate fuel shortages across Asia.
Fuel exports rebounded in August following the policy change, with Chinese refiners shipping 6.01 million tonnes of petroleum products, a 12.7% increase from a year earlier after Beijing eased export controls in mid-July.
China’s fuel exports surged between July and September, but new restrictions appear to have been introduced in October. Beijing reportedly did not approve fuel shipments to destinations beyond Hong Kong and Macau ahead of the week-long Golden Week holiday, which began on October 1. It remains uncertain whether export approvals will resume after the holiday ends on October 7.
Analysts said last week that China could further reduce fuel exports in October, potentially putting additional pressure on the global fuel market. The possibility comes as domestic gasoline and diesel inventories have fallen to multi-year lows.
China’s fuel exports could decline in October as gasoline and diesel inventories have fallen to seven-year lows, according to GL Consulting. If Beijing makes prioritizing domestic fuel supplies an official policy and reinstates export restrictions, already-tight global fuel markets could face another significant reduction in available supplies.
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