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Ulviyya Poladova

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China’s state-owned oil refineries are expected to reduce diesel exports this month due to limited stockpiles.

According to consulting firm Energy Aspects, the restrictions could be eased only if domestic demand weakens.

In its latest report, the company cut its forecast for China’s diesel exports this month by 400,000 tonnes to 580,000 tonnes. However, Energy Aspects noted that refineries are seeking to maintain high export levels and expect domestic demand to weaken from mid-November. The company therefore does not rule out the possibility of revising its forecast upwards.

Last month, China allocated additional fuel export quotas to refineries, bringing the total volume of export quotas issued since the beginning of the year to its highest level since 2021. However, following the outbreak of the US-Iran conflict, authorities tightened controls over monthly fuel exports.

In August and September, Chinese refineries increased exports, playing a stabilizing role in the global market, which had been disrupted by the conflict in the Middle East and the Russia-Ukraine war.

Energy Aspects also attributed the downward revision in its diesel export forecast to weaker export margins. Meanwhile, the consulting firm left its forecasts for gasoline and jet fuel exports unchanged. China’s gasoline exports are expected to reach 780,000 tonnes in November, while jet fuel exports are projected at 2.21 million tonnes.