China recently released the first batch of LSFO export quotas for 2024 at 8 million tonnes, including 3.83 million tonnes for Sinopec, 3.41 million tonnes for CNPC, 68,000 tonnes for CNOOC, 20,000 tonnes for Sinochem and 60,000 tonnes for Zhejiang Petroleum & Chemical. The figure was flat with that in 2023.
2024 First Batch of LSFO Export Quotas (Unit: '000 tonnes)
Group | The First Btach | |||||
2024 | Proportion | YOY Chg | 2023 | 2022 | 2021 | |
Sinopec | 3,830 | 47.88% | -10.72% | 4,290 | 3,840 | 2,400 |
CNPC | 3,410 | 42.63% | 12.91% | 3,020 | 2,030 | 1,490 |
CNOOC | 680 | 8.50% | 9.68% | 620 | 500 | 400 |
Sinochem | 20 | 0.25% | -33.33% | 30 | 30 | 320 |
Zhejiang Petroleum & Chemical | 60 | 0.75% | 50.00% | 40 | 100 | 390 |
Total | 8,000 | 100.00% | 0.00% | 8,000 | 6,500 | 5,000 |
Source: OilChem
Based on OilChem's data, China has totally released three batches of low-sulfur fuel oil export quotas at 14 million tonnes in 2023, down 2.75 million tonnes, or 16.42% year-on-year, while the actual export quotas stood at 13.17 million tonnes.
2023 LSFO Export Quotas (Unit: '000 tonnes)
Enterprise | The First Batch | The Second Batch | The Third Batch | Total | Proportion |
Sinopec | 4,290 | 1,440 | 1,420 | 7,150 | 51.07% |
CNPC | 3,020 | 1,270 | 1,300 | 5,590 | 39.93% |
CNOOC | 620 | 250 | 250 | 1,120 | 8.00% |
Sinochem | 30 | 10 | 10 | 50 | 0.36% |
Zhejiang Petroleum & Chemical | 40 | 30 | 20 | 90 | 0.64% |
Total | 8,000 | 3,000 | 3,000 | 14,000 | 100.00% |
Source: OilChem
China domestic low-sulfur fuel oil production is estimated to about 13 million tonnes in 2023, up 32% from last year, data from OilChem showed. According to the actual export quota, more than 98% of low-sulfur fuel oil export quotas have been used in 2023, which basically met the export needs of various production enterprises. However, facing with poor profits, refineries had low production enthusiasm, so the enterprises with insufficient export quotas have not continued to apply for more quotas. The usage of fuel oil export quotas has increased year by year over 2020-2023.
2020-2023 LSFO Export Quotas Usage
Source: OilChem
From the perspective of the release of the first batch of low-sulfur fuel oil exports in 2024, it was still basically equivalent to the current low-sulfur fuel oil production and supply capacity of enterprises in China, ensuring the orderly production and export of low-sulfur fuel oil in 2024.
OilChem believes that China low-sulfur fuel oil production might rally to 1.20million tonnes in January 2024, while that volume might be less than 700,000 tonnes in December 2023, the lowest point with the year.
Written by Catherine Sun, sss@oilchem.net
Edited by Aggie Hu, huchenying@mysteel.com