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Market Chatter: China Keeps Fuel Exports Elevated as Refiners Cash In on Surging Overseas Margins

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China is expected to maintain elevated refined-fuel exports in September as Beijing gradually eases restrictions imposed earlier this year, according to a Reuters report, citing five trade sources familiar with the matter.

The move is set to allow the country's refiners to capitalize on soaring overseas margins amid persistent supply disruptions in Russia and the Middle East.

This comes amid a persistently tight refined fuel market, with Russia, one of the world's largest exporters before the war in Ukraine, becoming an importer following relentless Ukrainian drone attacks against the country's energy infrastructure in recent months.

Fuel exports from the country are set to surge past 4 million metric tons this month, broadly matching August levels, but significantly above the 3 million-ton monthly average recorded last year.

This is helping to add to supplies for Asian countries, while capping prices amid persistent supply disruptions and uncertainties in recent months.

Jet fuel is expected to account for the biggest share of these exports, at 2.4 million tons, followed by diesel at 1 million tons and gasoline at 600,000 tons.

The report also noted that Asia's diesel refining margins were around $70 a barrel, which was more than three times what they were in February, before the war in Iran began.

The China Petroleum and Chemical Industry Federation did not immediately respond to' request for a comment on this story.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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