BEIJING: China exported record volumes of gasoil in September, triggering a decline in domestic stocks and leading the market to believe that Asia’s biggest oil consumer might have exported more than it should have, and therefore might be forced to limit overseas sales in October. September gasoil exports surged to a record high of 1.6 million mt, or 398,197 b/d, surpassing the previous high of 1.53 million mt, or 368,840 b/d, in July, according to data from the General Administration of Customs.
On a daily average basis in barrels, exports in September were 44.4% higher year on year and up 55.4% month on month. “We expect gasoil exports in October to retreat from the highs to just above 1 million mt as good domestic demand is expected to keep the barrels at home,” a Beijing-based analyst said. Sinopec, China’s leading gasoil exporter, was estimated to have exported around 850,000 mt last month from its refineries in the southern and eastern coasts. It was a big jump from an estimated 440,000 mt exported in August.
PetroChina was estimated to have increased gasoil exports significantly to around 428,000 mt in September from its refineries in northeast China, the southwest Yunnan province, as well as from Guangxi province. In August and July, gasoil exports from the regions were 343,000 mt and 385,000 mt, respectively.
China’s gasoil exports are mainly from state-owned refineries under Sinopec, PetroChina, CNOOC and Sinochem, as they are more experienced than the independent refiners in exporting the barrels. State-run refiners normally also have less flexibility in their export plans, which are usually made at least one month ahead of loading. This plan is seldom changed even if the situation of availability changes quickly. “This time, in September, the reason China sent out such big volumes of gasoil was not because of the surplus situation in the domestic market,” a Shenzhen-based trader said. “High outflows, on the contrary, have created a situation of tight supply within the country.”
