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China's April gasoline exports fall to lowest level since July 2015 on recovering domestic demand

China's gasoline exports in April fell to the lowest level since July 2015, as domestic travel and fuel use increased in the recovering economy.

April exports of gasoline stood at 400,000 MMt, down 50.8% from a year earlier, General Administration of Customs data showed on Saturday, and 65% below March's 1.15 MMt.

A growing tourist preference for short-distance travel is favouring car trips over flights and boosting domestic gasoline demand, according to Shiqing Xia, oils and chemicals consultant at Wood Mackenzie.

China's gasoline exports will likely remain at a low level in May. Analysts forecast domestic demand will increase 3-6% year-on-year in May based on the increase in travel during China's Labour Day holiday.

Domestic travel during the five-day holiday increased by 28% compared to 2019, before the pandemic, even as heavy rainfall in south China limited growth in travel in that part of the country, said Jianan Sun, China energy market analyst at Energy Aspects. 

Diesel exports were at 760,000 t in April, down 46% from 1.42 MMt in March on weak export arbitrage and limited quotas. However, that was up 21.8% from the previous year, customs data showed. Traders expect diesel exports to ease further in May as state refiners have already used up most of their quotas. 

Sinopec and PetroChina are considering cutting back on refined fuel output in June, traders say, as excess diesel has squeezed refining profits in Asia. Refining margins in Singapore, the Asia bellwether, slipped under $4/bbl in April from nearly $6 in March, LSEG data showed, despite several plants shutting for maintenance during low demand season in the second quarter. 

Jet fuel exports in April were 1.59 MMt, up 90.4% from year-ago levels but down from 1.98 MMt in March, the data showed.

International flights more than doubled year-on-year to 55,672 in April, according to civil aviation data provider Variflight, although they were still 30% lower than in April 2019.

Fuel provided to international flights is counted as an export in customs statistics.

In addition to aviation bunkering demand, jet fuel exports have been buoyed by healthy sales margins outside mainland China, several China-based trade sources said, adding that this trend could continue in May and June.

April imports of liquefied natural gas (LNG) were up 31.5% on the year at 6.22 MMt, data showed, aided in part by attractive spot prices. That was down however from March's 6.65 MMt.

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