CHINA DATA: Gasoil exports sink to multi-year lows in Jan, Feb on quota cuts

China's gasoil exports hit multi-year lows in January and February, at 220,000 mt and 200,000 mt, respectively, according to data released March 18 by the General Administration of Customs, reflecting a steep reduction in export quota allocations.

These were the lowest monthly export volumes since just 63,000 mt was sent overseas in September 2013, according to GAC data.

Total exports of 420,000 mt in the first two months of 2022 were down 87.8% year-on-year.

China slashed gasoline, gasoil and jet export allocations in the first batch of quotas for 2022 by 56% year on year to 13 million mt, meaning the nine-year low for gasoil exports in February was more or less within expectations.

S&P Global Commodity Insights tracked export volumes of around 194,000 mt for the month, comprising 84,000 mt from Norinco's Huajin, 70,000 mt from Sinopec and 40,000 mt from ChemChina. PetroChina, CNOOC and Zhejiang Petroleum & Chemical all skipped exports in the month.

Gasoline exports in January-February also fell, down 46.7% year on year to 1.89 million mt, GAC data showed.

In February, gasoline exports bounced back 18.6% on the month to 1.02 million mt but this was still down 37.9% year on year.

S&P Global tracked at least 980,000 mt of gasoline going overseas in February, comprising 380,000 mt from PetroChina, 285,000 mt from Zhejiang Petroleum & Chemical, 205,000 mt from Sinochem's Quanzhou refinery, 80,000 mt from CNOOC and 30,000 mt from Sinopec.

Market sources said gasoline exports fell less than gasoil because the economics for gasoline in the international market were more attractive.

"Due to the significant export quota reduction, oil companies need to be cautious when making exports decisions to maximize export profit and balance domestic market supplies," a Singapore-based analyst said.

In contrast, jet exports in the first two months of the year were up 39.8% amid muted domestic consumption because of COVID controls and resurgent overseas demand for international flights.

Jet fuel exports were at 670,000 mt and 560,000 mt for February and January, respectively, GAC data showed.

At the same time, China cut jet fuel output by 18.4% year on year to 5.56 million mt in the first two months, data from the National Bureau of Statistics showed.

Looking forward to March, China's gasoil exports are likely to recover slightly to more than 500,000 mt as export margins have become more attractive, while gasoline outflows are likely to fall to as low as 520,000 mt amid tight export quotas, according to S&P Global estimates.

Jet fuel exports are likely to remain at the similar levels amid stable fundamentals.

China's key oil products exports ('000 mt)

Source: General Administration of Customs

Notes: * was adjusted according to the % change provided by the GAC