China is expected to cut quota allocations to cap its exports of gasoline, gasoil, and jet fuel in 2021 as part of its efforts to meet its carbon emission peak target. A source with a state-owned refiner said that the total quota in this year’s second batch would be reduced to just a few million tons. In December, Beijing issued 29.5 million tons of quota to ship gasoline, gasoil, and jet fuel to overseas markets in 2021. For comparison, the export quota in 2020 totalled 59.03 million tons.
Industry analysts expect PetroChina to use 85% of its first batch of quota in January-June, while Sinopec, Sinochem, and CNOOC are expected to use 50% of their quotas over the same period. These exporting refiners have reduced their gasoil and gasoline export plans by 18% and 24%, respectively, in June from May, an industry survey showed.
Previously, Beijing announced a new tax system on imported light cycle oil (LCO), kerosene, and mixed aromatics, which is expected to reduce gasoil and gasoline production and exports. In contrast, China is expected to increase export quotas for fuel oil from 10 million tons in 2020 to 15 million tons in 2021.
