China increases the annual export quota of gasoline, diesel and jet fuel The Chinese regulator increased the annual export quota of gasoline, diesel and jet fuel to 42 million tons - by 6% compared to last year. And although in analytics it looks like a new source of supply of petroleum products, the November shipment schedule suggests the opposite. On November 5, Reuters reported that Chinese refineries sold only about 500,000 tons of diesel for export with delivery in November. Several industry sources estimate that total volumes for the month will be less than 800,000 tons, compared to 1.8 million tons of actual shipments in September. Based on the conversion factor (7.45 barrels per ton), this initial upper limit is about 199 thousand barrels per day, which is 248 thousand barrels per day less than in September. And the question is not only about the export economy and not about the export margin (according to sources it reaches 800 yuan per ton). The limiting factor is physical reserves and production volumes in the refinery. Commercial diesel reserves in Israel fell to 11.1 million tons - this is the lowest figure for the entire period of Oilchem's statistics (since 2011). Refineries limited sales in the local market, and several districts even introduced supply rationing. The situation in the Asian market also clearly shows that it is impossible to see "Chinese exports" as something homogeneous. The actual volume of deliveries depends on the allocation of quotas, the monthly approvals, the output structure of the oil products and their availability in the local market. Conclusion: the quota of 42 million tons is only a permit, not an actual delivery of the product. Until specific applications, processed cargoes and actual shipments prove otherwise in practice, expectations based only on "paper" quotas greatly exaggerate the estimated amount of diesel that China can immediately export.

China increases the annual export quota of gasoline, diesel and jet fuel The Chinese regulator increased the annual export quota of gasoline, diesel and jet fuel to 42 million tons - by 6% compared to last year. And although in analytics it looks like a new source of supply of petroleum products, the November shipment schedule suggests the opposite. On November 5, Reuters reported that Chinese refineries sold only about 500,000 tons of diesel for export with delivery in November. Several industry sources estimate that total volumes for the month will be less than 800,000 tons, compared to 1.8 million tons of actual shipments in September. Based on the conversion factor (7.45 barrels per ton), this initial upper limit is about 199 thousand barrels per day, which is 248 thousand barrels per day less than in September. And the question is not only about the export economy and not about the export margin (according to sources it reaches 800 yuan per ton). The limiting factor is physical reserves and production volumes in the refinery. Commercial diesel reserves in Israel fell to 11.1 million tons - this is the lowest figure for the entire period of Oilchem's statistics (since 2011). Refineries limited sales in the local market, and several districts even introduced supply rationing. The situation in the Asian market also clearly shows that it is impossible to see "Chinese exports" as something homogeneous. The actual volume of deliveries depends on the allocation of quotas, the monthly approvals, the output structure of the oil products and their availability in the local market. Conclusion: the quota of 42 million tons is only a permit, not an actual delivery of the product. Until specific applications, processed cargoes and actual shipments prove otherwise in practice, expectations based only on "paper" quotas greatly exaggerate the estimated amount of diesel that China can immediately export.