China Halts October Fuel Exports as Global Diesel Crunch Deepens
China’s major refiners have suspended most refined fuel exports for October as Beijing prioritizes domestic supply security, removing another source of diesel, gasoline and jet fuel from an already severely constrained global market. PetroChina has cancelled several gasoline and jet fuel cargoes scheduled for October, while Zhejiang Petrochemical did not schedule exports during China’s week-long…
China has halted refined fuel exports for October as it prioritizes domestic supply security, exacerbating the global fuel shortage. PetroChina cancelled several gasoline and jet fuel shipments, while Zhejiang Petrochemical halted exports during the National Day holiday. Beijing has not yet authorized exports outside Hong Kong and Macau, but shipments may resume after the holiday, depending on domestic inventories and refinery output.
This move follows a sharp decline in China's fuel-stock position, with commercial diesel and gasoil inventories falling around 20 million barrels below pre-war levels. Gasoline stocks are also short by approximately 9 million barrels. China had increased exports during the summer, with total oil-product exports reaching 6.01 million tonnes in August, up 12.7% year-on-year.
The reversal comes as global diesel supplies face pressure from Middle Eastern disruptions and attacks on Russian refineries in Ukraine. S&P Global warns that Asian fuel markets have limited surplus supply, meaning any further restriction on U.S. diesel exports could intensify competition for Asian and Middle Eastern barrels. The Chinese government has intervened to mitigate the impact of high international oil prices, temporarily suppressing fuel price increases in September and instructing refiners to ensure stable supplies.
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