China Resumes Fuel Exports Amid Lucrative Margins

China has lifted fuel export restrictions, aiding in the stabilization of transportation fuel prices after disruptions from the Iran conflict. Private refiners have resumed shipments, capitalizing on high export margins, with significant increases projected in gasoline, diesel, and jet fuel exports in July.

China is reentering the global fuel market by easing restrictions on refined fuel exports, a decision expected to relieve transportation fuel prices in Asia. The move follows an interim peace deal between the U.S. and Iran, allowing China's refiners to again export without constraints imposed earlier this year.

Refiners like Zhejiang Petrochemical Co are set to resume shipments, increasing export volumes significantly. Sources within the trade industry indicate plans to export up to 3 million metric tons of fuel this month. The resumption of these exports comes after a four-month suspension, marking a potential turnaround in the oil market.

The profitability of fuel exports is currently high, with margins at 1,000 yuan per ton. Analysts suggest that as export restrictions ease, refiners will aim to leverage remaining quotas to maximize returns. This shift could influence domestic market dynamics, especially with increasing competition from electric vehicles.