China Ramps Up Fuel Exports as Domestic Inventories Surge

Diesel exports hit 810,000 tons in July, surging 88% compared to the previous month. This sharp uptick aligns with the highest monthly averages recorded this year, driven by persistent shortages in global markets linked to the ongoing wars in Ukraine and the Middle East. Gasoline exports also saw a dramatic monthly rise of 320%, though they remain 55.3% lower than year-ago levels.

The government’s move to relax export curbs—initially tightened in March following the closure of the Strait of Hormuz—allows for an additional 2.7 million tons of refined products to hit international markets through August. Refiners may carry over unused quotas into September if immediate demand remains soft. These policy adjustments reflect a cooling domestic market, where swelling stockpiles have provided a necessary buffer, preventing more aggressive oil price spikes during the recent geopolitical instability.