China Daily Oil Summary: Underwhelming Fourth Batch of Crude Import Quotas

China released its fourth batch of crude oil import quotas for non-state-owned totalling 9.54m mt and below expectations, according to OilChem.

• Of the total, 53% went to independent refineries, 41% to private integrated refineries, and other entities receiving the remaining 6%.
• Exports of refined products from China in September are estimated to have been 4.01m mt, up 28% compared to August, according to OilChem’s tracking of ship schedules. The rise is attributed to the release of the third batch of export quotas on Sep. 1 and a consistently high export profit margin.
• Global airline capacity has fallen to 110.5m in the week commencing Oct. 9, according to OAG, down 1.1% on the previous week.
• Domestic reductions have been driven by a fall in Northeast Asia, responsible for 83% of the decrease. This is likely due to an abating of travel demand in China following the end of its Golden Week holiday period.
• YUAN: The currency strengthened to 7.2922 against the dollar from 7.3002 on Sep 28, the last trading day before the Golden Week holiday. The PBOC set the dollar-yuan central parity rate lower at 7.1789, compared with 7.1798 set before the holiday. The fixing was estimated at 7.2975 by Bloomberg survey today.
• Tourism spending recovered strongly during the Golden Week holiday, with 826 million domestic trips recorded, a rise of 71.3% y/y, or 4.1% when compared to the same period in 2019, according to data by the Ministry of Culture and Tourism. This led to CNY753 billion of tourism revenue, an increase of 129.5% y/y, or 1.5% compared to the pre-pandemic level.
• LIQUIDITY: The People's Bank of China (PBOC) conducted CNY20 billion via 7-day reverse repo, with the rate unchanged at 1.80%.