China’s gasoline exports plummeted to their lowest level since July 2015 in April, falling 50.8% year-on-year to just 400,000 metric tons (3.38 million barrels per day). This sharp decline was driven by a resurgence in domestic travel and fuel use as the Chinese economy continues to recover.
According to the data from China’s General Administration of Customs, the April gasoline exports were also 65% lower than the 1.15 million tons recorded in March. Analysts attribute this to a growing preference among Chinese travelers for shorter, car-based trips over flights, which has boosted domestic gasoline demand.
Shiqing Xia, an oils and chemicals consultant at Wood Mackenzie, expects China’s gasoline exports to remain low in May as well. Forecasts suggest domestic gasoline demand could increase 3-6% year-on-year in May, based on the surge in travel during the recent Labor Day holiday, where domestic tourism grew by 28% compared to 2019 pre-pandemic levels.
The trend is similar for diesel exports, which fell 46% from March to 760,000 tons in April, though this was still 21.8% higher than a year earlier. Traders expect diesel exports to decline further in May as state refiners have already used up most of their export quotas.
Jet fuel exports, however, bucked the trend, rising 90.4% year-on-year to 1.59 million metric tons in April, although this was down from 1.98 million tons in March. The strength in jet fuel exports is attributed to both increased international flight activity and healthy sales margins outside mainland China.
Overall, the data suggests China’s domestic energy demand is recovering, driven by a rebound in travel and economic activity, leading to a sharp drop in the country’s fuel exports. This could have implications for global energy markets as China, a major exporter, reduces its overseas shipments.