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China: Bonded bunker fuel avails to remain tight between May to June

11 May 2022

The world’s top crude oil buyer imported a total 171 million tonnes of crude oil from January to April 2022, according to data released by the General Administration of Customs on Monday (9 May). 

The import volume in April was up 7% on year while the average import price increased by 54.3% to RMB 4,323.6 per tonne in the same month.

A local supplier on the Chinese mainland meanwhile told Manifold Times the supply of bunker fuel will be increasingly tight from May to June with all suppliers struggling to meet demand.

Most domestic refinery resources are heavily dependent on top refiner Sinopec Zhoushan while high import cost and low domestic refinery production also contribute to the scarce supply. 

Domestic refineries have been unwilling to supply refined oil products, let alone bonded bunker fuel, said local suppliers. 

If domestic bonded bunker suppliers refined imported oil locally, the cost would increase and they would be unable to compete with Singapore. 

Last year, the overall Chinese mainland bonded oil price, especially in Zhoushan, was lower than Singapore but it remains to be seen if this will continue in the coming months. 

It is understood that the current situation is expected to be difficult to be resolved in a short term period.

 

Photo credit: Dimitry Anikin on Unsplash
Published: 11 May, 2022

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