China may export more diesel to meet winter demand

Releasing stocks of diesel would partially reverse 2021 export ban, give relief to global market

- Luke Pachymuthu 

China’s refiners are set to release huge stocks of diesel onto the world market just in time to meet winter demand, according to industry sources.

Refinitiv, a unit of the London Stock Exchange Group, said Beijing has granted refiners up to 15 million tonnes of oil product quotas for the rest of the year, partially reversing an export ban imposed in 2021.

Mr John Driscoll, managing director of consultancy JTD Energy Services, said any expanded exports from China would provide relief to a jittery market facing tight supplies ahead of winter.

“If China goes through with expanding its diesel exports, it will be viewed as a positive and constructive move for market,” he said.

“Other regional refiners might not be too pleased because the additional supplies will soften the market outlook, but consumers will not be complaining.” Mr Yaw Yan Chong, director of oil research at Refinitiv, said most of the new export quotas would be for diesel, used commonly as heating fuel and power generation.