DELAY IN ISSUING QUOTAS WILL STALL CHINESE EXPORTS TEMPORARILY

摘要

At least eleven of China’s state-owned andrnindependent refiners have preponed theirrnrefinery maintenance to May. Traditionally,rnJuly-August is the maintenance periodrnfor refiners in China. Nonetheless, thesernrefiners have announced that their plantsrnwill be shut down for annual maintenancernearly this year. Nearly 17% of Chinesernthroughput will be taken offline for at leastrn30 days in May-June. So far, only elevenrnrefiners have announced their plans;rnhowever, more refiners are expectedrnto follow suit. The maintenance will haltrnsurging Chinese throughput, which hadrnreached a record high of 12.13 mbpdrnin March. Crude arrivals and products’rnexports will slowdown in the secondrnquarter. High throughput had squeezedrnrefining margins in Asia and supportedrnexports from China, which will slow downrnbecause of upcoming maintenance. Withrnalready a month in the second quarter,rnChina is yet to issue the second batchrnof export quotas, which has led refinersrnto conduct annual maintenance early on.rnUsually, the second batch of quotas isrnallotted by the end of first quarter, howeverrnthis time the Chinese government isrnexpected to issue quotas for the remainingrnmonths of the year by end of May. Delayrnin allotting quotas and maintenance willrnslowdown exports of oil products fromrnChina in the second quarter.