Beijing has lower the crude oil import quotas for unbiased refiners for the remainder of the yr within the newest transfer to curb their rising oil market clout, Reuters has reported, citing trade sources.In response to the report, the most recent crude import quotas for independents is 14.89 million tons. This brings the full for the yr to 177.14 million tons, which compares with 184.55 million tons for 2020.This might usually be strongly bearish information for oil. However there’s a lot occurring for the bulls it is probably that the impact of what quantities to a future decline in Chinese language oil imports will probably be momentary.
A complete of 16 unbiased refiners have been granted import quotas, with the most important awarded to Hengli Petrochemical. Nevertheless, the most important non-public refinery operator, Zhejiang Petrochemical Co, was not granted an import quota for its 800,000-bpd facility.China’s crude oil imports over the primary 9 months of the yr fell by 6.8 % from the identical interval of 2020, with September imports alone dropping by greater than 15 % from a yr earlier.Beijing’s crackdown on the non-public refining trade was one motive behind this import decline as the federal government tackled extreme gas provide, a lot of which got here from teapots. Allegations of environmental legislation violations and tax evasion have been additionally leveled towards some unbiased refiners. Moreover, Beijing ordered state-owned refiners to cease buying and selling their import quotas with non-public friends.
Because it tackles teapots, nevertheless, Beijing is having hassle securing sufficient vitality provides for the winter amid hovering fuel and coal costs. Orders for reinforcing home coal manufacturing have been issued, and China can be ramping up its fuel provides. It’s also altering its record of priorities, with decarbonization getting trumped by vitality safety.”Vitality safety ought to be the premise on which a contemporary vitality system is constructed, and the capability for vitality self-supply ought to be enhanced,” Premier Li Keqiang stated in an announcement earlier this week.By Irina Slav for Oilprice.comMore High Reads From Oilprice.com: