China Increases VLSFO Export Quotas

Credit: jason-yuen-unsplash

A recent news article published in the Engine states that China boosts VLSFO export quotas in first allocation.

8 million mt of VLSFO export quotas

The Chinese government has recently allocated 8 million mt of VLSFO export quotas for bonded bunkering in its first round for 2023.

China’s export quota is up by 23% from last year’s first quota of 6.5 million mt, data from information provider JLC data shows. The quotas have been allocated to five major refiners.

The fresh quotas could contribute to widen Zhoushan’s VLSFO discount to Singapore and other regional hubs further over the coming weeks, a trader says. Despite offering VLSFO at competitive levels in recent weeks, the Chinese bunkering hub has struggled to attract much demand.

Recent weather disruptions in Zhoushan

Sources argue that recent weather disruptions in Zhoushan have probably influenced bunker buyers to look out for bunkers elsewhere. Weather disruptions could continue to trouble Zhoushan over the coming weeks, as the weather is typically harsher during winter.

In 2022, the Chinese government allocated a total of 16.75 million mt of VLSFO export quotas in five batches, up from a total of 11.39 million mt allocated in 2021.

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Source: Engine Online