China's Low Industrial Activity Spurs Gasoline, Gasoil Exports

China's oil product exports rose sharply in May with the resumption of gasoil sales to Europe and several rare gasoline shipments made within the Asian market amid growing need for some destocking activity due to tepid industrial fuel demand at home, market participants said on June 21-22.
Chinese oil companies exported 598,000 tons, or around 4.49 million barrels, of gasoil in May, almost a fivefold jump from 122,000 tons in the same period a year earlier, while gasoline shipments rose 62% year-on-year and 65.4% on the month to 1.363 million tons (11.5 million barrels) last month, data from the General Administration of Customs showed on June 21, S&P Global Platts reported.
It is generally believed that the stocks of oil products in China have been building up mainly due to a tepid recovery in domestic demand, as well as weak export margins, industry and trading sources said.
The demand for gasoil has been relatively weak, leading to a slight buildup in the middle distillate product stock level, a Beijing-based analyst said.
Although the improvement seen in the country's services sector paints a positive outlook for domestic oil demand, manufacturing and construction sectors could struggle to contribute much to the overall fuel demand growth, market sources and analysts said.