China’s Refined Oil Prices Likely To Maintain Support: OilChem

Chinese refined product prices may soften in the near term, but will see a strong rebound from September, potentially prompting advanced stockpiling, according to OilChem.

• Peak demand season typically arrives in September and should support gasoline and gasoil prices, boosted by travelling during the week-long National Day holiday at the end of September.
• Maintenance at the Sinopec Guangzhou and Zhanjiang Dongxing Refineries from September-October could impact supply. Their combined capacity is 10m mt per annum.
• China's gasoline prices in South China, rose by 5.1% to 9,152 y/t from early July to mid-August buoyed by summer traveling, peak use of vehicle air conditioning and rising crude prices, according to an OilChem survey.
• Chinese producers are awaiting the release of a third batch of export quotas. However, there has been no official announcement to date. FGE predicts that 8m mt of licenses could be released in September.