Q1-Q3 China Fuel Oil Import Dropped Y-O-Y
From January to September 2020, China’s fuel oil import volume first fluctuated upward and then declined, and the total fuel oil import volume was 10.0274 million mt, down 0.7953 million mt or 7.35% Y-O-Y. SCI reckons that the major reason attributed to the decrease in China’s fuel oil import volume is that China’s refineries began to produce low-sulphur bunker from the beginning of 2020, and China’s import dependence degree of bonded bunker declined. With the implementation of IMO 2020, participants started to focus on the low-sulphur bunker supply. After the issuance of fuel oil export tax rebate policy under general trade and the issuance of 10 million mt fuel oil export tax rebate quotas, China’s refineries were active in low-sulphur bunker production, and China’s import demand for fuel oil shrank.
From January to September, the peak of the monthly fuel oil import volume appeared in May at 1.6002 million mt. The reason was that in April, the meltdown of international crude oil prices dragged the fuel oil prices down to the bottom as well. Therefore, participants began to replenish their inventory intensively, supporting the fuel oil import volume to grow. The bottom of the monthly fuel oil import volume was in July at 0.6184 million mt/a. The reason was that the global COVID-19 issue was aggravating, and the international shipping demand underperformed. Moreover, China’s output of low-sulphur bunker rose in June, and many participants focused on consuming their inventory. As a consequence, China’s fuel oil import volume slumped.
