China’s diesel and gasoline exports surged in the first half of the year as a domestic supply glut and slowing demand growth prompted refiners to sell more fuel abroad.
Diesel shipments jumped almost 21 percent in the first six months compared to the same period a year ago, averaging about 328,500 barrels a day, according to Bloomberg calculations based on data posted Sunday on the website of the General Administration of Customs. Gasoline exports rose 8.1 percent, averaging nearly 222,000 barrels a day.
China’s state-run fuel makers have sent more fuel overseas to draw down stockpiles that have swollen thanks to a refining capacity glut and higher production from independent refiners, known generally as teapots. Meanwhile, the nation’s gasoline and diesel demand growth has been slowed by alternative transportation such as shared bicycles, as well as gas-fed vehicles and electric cars, according to ICIS China, a Shanghai-based commodity researcher.
“Alternative transportation has taken a notable toll on consumption of traditional fuels this year,” Lin Jiaxin, an analyst with ICIS China, said before the data were released. “With new refining units coming online in the second half of the year, refiners will have to ship even more overseas.”
Average gasoline demand in China, the world’s biggest energy user, will grow by 95,000 barrels a day this year, “dramatically” below gains of 230,000-290,000 barrels a day during the prior two years, the Paris-based International Energy Agency said in a report this month.
The use of shared bikes in big cities may replace 1.27 million metric tons of gasoline demand this year while natural gas cars have already displaced 22 million tons of fuel used in transportation in 2016, according to Guo Yifan, an analyst at Shanghai-based Sinolink Securities.
The nation’s gasoline exports totaled 4.81 million tons in the first half of the year, with 770,000 tons shipped in June, Sunday’s data showed. Diesel shipments totaled 7.97 million tons between January and June, with exports at 1.31 million tons last month.