China plans to restrict diesel exports

In its note dated November 5, the consultancy company reduced its diesel shipment forecast for this month by 400 thousand tons to 580 thousand tons. Still, Energy Aspects stated that refineries are trying to maintain high export levels and that they predict that local demand will weaken as of mid-November, adding that "it is possible for the forecasts to be revised upwards."

China allocated an additional fuel export quota to refineries last month, increasing the allocations made since the beginning of the year to the highest level since 2021. But since the US-Iran conflict, authorities have been monitoring monthly shipments more tightly. Refineries increased their exports in August and September, providing some relief to the global market that was disrupted by the Middle East conflict and the Ukraine-Russia war.

Energy Aspects also cited the weakening of export margins as the reason for the decrease in diesel export forecast. The consultancy company kept its forecasts for this month's gasoline and jet fuel shipments unchanged at 780 thousand tons and 2.21 million tons, respectively.