China slashed oil product export quotas by 73% year-on-year in the second batch allocation for 2021. Analysts said green targets were one of the reasons behind the reduction. Dong Xiucheng, a professor at the University of International Business and Economics, said China is seeking to reduce unsustainable crude oil imports and fuel exports in a bid to achieve peak carbon emissions by 2030.
At the same time, domestic supply has tightened, reducing the need to export surplus fuel. Weak export margins and tepid overseas demand also contributed to the reduction. Profits for exporting gasoline and diesel decreased in July by CNY390 ($60) and CNY230 ($35) per ton year-on-year, respectively. Gasoline exports are expected to decline by 22% to 12.44 million tons in 2021, while diesel shipments might drop 14% to 16.92 million tons, an industry survey showed.
