China's May fuel oil imports ease after hitting highest in a decade
(Reuters) - China's fuel oil imports dipped in May after hitting a decade-high in April, while exports of low-sulfur marine fuels rose, General Administration of Customs data showed on Tuesday.
Total fuel oil imports in May were at 2.58 million metric tons, down 3% from April.
"Straight-run fuel oil buying interest retreated in May as processing margins dropped with the declines in domestic gasoil, and to some extent, gasoline prices," said Mia Geng, FGE's head of China oil service.
"We see sustained high imports in June-July but we expect volumes to taper off afterwards as margins drop further. The depleting fuel oil import quotas is another constraint, which is expected to run out by Q4," said Geng.
For now, the level was still strong compared to historical monthly volumes. May imports were 150% higher than the same month last year, the data showed.
China's independent oil refiners have ramped up fuel oil imports as ongoing cargo inspections at refining hub Shandong cut off supplies of lower-priced feedstock bitumen blend, while appetite for discounted and blended barrels of Russian fuel loaded out of Malaysia remains firm.
Meanwhile, China's exports of low-sulfur marine fuels, measured mostly by sales from bonded storage for vessels plying international routes, totaled 1.85 million metric tons in May, up 36% from April.
The recovery came in line with firmer sales for bunkering in May across key refueling hubs, including Singapore and the UAE's Fujairah.
The table below shows China's fuel oil imports and exports in metric tons. The exports section largely captures China's low-sulfur oil bunkering sales along its coast.
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