Beijing bolsters Sinopec at private sector's expense

摘要

China's independent refiners,from small-scale operators in Shandong province to giants such as Rongsheng and Shenghong,are having a tough year-not because of difficult trading conditions but because of steps Beijing is taking to bolster the market power of the state and its refining giant Sinopec.The government launched a series of rolling tax audits in April aimed at eliminating tax evasion in road fuel markets.These were widely seen as targeting under-reporting of road fuel output by refiners in Shandong and the production of gasoline and diesel from untaxed blendstocks by private-sector blending firms.Then in June,the ministry of commerce handed out another batch of crude import quotas to private-sector firms that appeared to overlook textile producers Rongsheng and Shenghong,which operate two of the giant integrated refining and petrochemical facilities touted until recently as the new model for downstream development in China.Rongsheng-which built an 800,000 b/d complex to provide a captive source of paraxylene-has been given quotas to import just 350,000 b/d of crude,while Shenghong-which hopes to open a 320,000 b/d facility in August-has received no crude import quota.