China — Chinese refiners have halted oil-product exports to destinations outside Hong Kong and Macau until Beijing issues further instructions, according to people familiar with the matter.
The suspension comes as global fuel markets are already contending with supply losses associated with disruptions in the Middle East and Russia.
The move affects China, the world’s largest refining hub, at the start of the country’s week-long holiday. Major refiners were not granted approval to send fuel products to markets outside Hong Kong and Macau during October, leaving the timing of any wider resumption uncertain.
PetroChina has already cancelled several gasoline and jet-fuel cargoes scheduled for October. Three sources said many of those deals had been reached within the previous two weeks.
Zhejiang Petrochemical Corp, another major Chinese refiner, also did not schedule oil-product shipments during the holiday week, according to one source.
China had previously tightened fuel exports in March after the outbreak of the U.S.-Israeli war on Iran disrupted crude supplies from the Middle East. Restrictions were subsequently eased between July and September, making the latest move a renewed tightening of exports.
The effects were quickly reflected in Asian refining markets. Diesel refining margins rose to around $75 a barrel, the highest level in a week, while the October-November price spread climbed to a two-week high as traders responded to the prospect of tighter supplies.
The sources said it remains uncertain whether Beijing will permit exports to resume after the holiday ends on October 7. That decision could depend on domestic fuel inventories and refinery output.
The suspension creates another potential supply constraint for international fuel markets. With disruptions already affecting Middle Eastern and Russian supplies, lower Chinese exports could leave buyers in some markets competing for a smaller supply of refined products.
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