China Diesel Exports Rise to Record as Refiners Boost Output
(Bloomberg) -- China’s fuel exports rebounded in September, with diesel hitting a record, as refiners increased output following seasonal maintenance.
The world’s largest energy consumer exported 1.6 million metric tons of diesel last month, according to data released by the General Administration of Customs on Friday. Shipments averaged almost 397,900 barrels a day, more than 50 percent higher from a month earlier. Domestic diesel production gained 3 percent from August to 3.58 million barrels a day, Bloomberg calculations based on data from the National Bureau of Statistics show.
The nation’s oil refining rate last month rose 2.2 percent from August to 10.7 million barrels a day. That may rise further starting this month as diesel demand improves in the last quarter of the year, according to ICIS China, a Shanghai-based commodity researcher.
“China’s fuel exports will likely remain strong for the rest of the year as oil processing is expected to climb in the fourth quarter in the absence of refinery maintenance,” Lin Jiaxin, an analyst with ICIS China, said by phone from Guangzhou, before data were released.
Gasoline exports rose 25 percent from the previous month, rebounding from a five-month low to 840,000 tons. That’s about 233,800 barrels a day. Outbound kerosene shipments fell 4.4 percent to 1.08 million tons.
Exports of gasoline and diesel have been elevated amid tepid domestic demand growth and higher refinery activity. Fuel consumption fell year-on-year for a fifth month in September, according to Bloomberg calculations. Total oil demand is forecast to rise about 2.1 percent this year to 11.71 million barrels a day, slowing from last year’s 6.5 percent growth, according to International Energy Agency estimates in its latest monthly report.
There are some factors that may slow exports. A rapid expansion in car sales in the past three months may support domestic gasoline demand in the fourth quarter, Bloomberg Intelligence analyst Wang Lu said in a note on Oct. 3. Meanwhile, China’s fourth batch of fuel-export quotas for this year dropped 43 percent from the previous allowance to 3.47 million tons, according to ICIS China.
With assistance from Jing Yang