MARKET EYE: China Cools to Fuel Oil

摘要

Chinese fuel oil buying has slowed significantly in early 2009, traders say after strong buying in December helped prop up the heavy oil market in Asia and draw down record-high stocks in Singapore (IOD Dec.5,p5).Demand late last year was driven by two factors: low prices and a tax deadline. Low fuel oil prices - which had fallen in line with crude - encouraged fresh buying interest from Chinas simple, so-called teapot, refineries. At the same time, Chinese refiners accelerated buying and built up stocks before an eight-fold increase in the consumption tax on fuel oil went into effect on Jan. 1.