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Explore the latest trends and actionable insights on the China Oil & Gas Exploration and Production market to inform business strategy and pinpoint opportunities and risks

China’s Diesel and Jet Exports Fall Short of Expectations Due to New Quotas

Industry: Aerospace and Defense
Current: Other Industry Indicators

Gasoline exports increased 19% to a three-month high in July 2022
Volume of exports of diesel and aviation fuel was much lower than expected
Jet fuel exports declined 27% until January 2021 but increased to 8.6% thereafter

Refiners increased gasoline exports by 19% in July 2022 thanks to new quotas, reducing domestic stock surpluses and reaching a three-month high.

According to data from China’s General Administration of Customs, gasoline exports reached 880,000 tonnes in July 2022, the highest level since April, but year-to-date volumes were 37% lower than in 2021.

Diesel and aviation fuel exports, however, surprised everyone, with volumes lower than expected. According to GlobalData, over the past five to six years, natural gas reserves grew from 184.419 trillion cubic feet in 2017 to 234.99 trillion cubic feet in 2021.

There was only a marginal increase in diesel exports from June 2022 to 360,000 tonnes in July, just half the forecast level and less than a quarter of the 1.39 million tonnes in July 2021, according to data from China’s General Administration of Customs. Notably, China’s oil reserves also increased in the last five to six years, from 25.62 billion barrels in 2017 to 26.02 billion barrels in 2021.

Similarly, exports of jet fuel decreased 27% to 480,000 tonnes, their lowest level since January 2021. Exports increased 8.6% since 2021.

China announced two sets of export quotas in June and July 2022 after businesses sought additional permits to reduce excessive domestic stocks as COVID-19-induced lockdowns reduced fuel consumption in the country.

Exports of the three fuels are projected to increase in August 2022 due to new quotas mostly because of shipments of diesel fuel, but they could be capped at seven-year lows by additional curbs likely to be announced in 2022.

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