China’s exports of low-sulfur marine fuels (LSFO) saw a slight decline in 2024, while fuel oil imports surged to record levels. These trends reflect evolving market dynamics, government policies, and international factors.
Key Highlights
LSFO Exports
- 2024 Exports: 18.33 million tons (-1.6% from 2023).
- Decline attributed to reduced export quotas in the final batch of the year, despite increased global demand for bunkering.
- Main grade exported: Very Low Sulfur Fuel Oil (VLSFO) with a maximum sulfur content of 0.5%, compliant with IMO emission standards.
- Contrast: Other major hubs like Singapore and Fujairah reported higher bunker sales.
Zhoushan Refuelling Hub
- Bunker volumes reached 7.26 million tons in 2024, a record high.
- Number of licensed bonded bunker suppliers: Increased to 37 in 2024 (from 34 in 2023).
Fuel Oil Imports
- 2024 Imports: 24.1 million tons (+7.4%, a record high).
- Driving Factors:
- Chinese independent refineries leveraged low-cost fuel oil feedstock, often discounted Russian oil blends.
- Increased purchases under ordinary trade and imports into bonded storage.
2025 Outlook
Fuel Oil Imports Expected to Decline
- Tariffs & Taxes:
- Increased import tax and reduced tax rebates to dampen demand.
- Sanctions Uncertainty:
- Logistical challenges in importing Russian fuel oil due to sanctions.
- Shift in Strategy:
- Refineries may seek alternative feedstocks or adjust to policy changes.
Market Implications
China’s shifting trade and export policies will likely impact global marine fuel supply chains. The country’s focus on refining capacity and domestic needs, coupled with sanctions and tax reforms, could reshape its role as a major player in the marine fuel market in 2025.
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Source: MARINE LINK
