China slashes first round of oil product export quotas

Oil

China’s Ministry of Commerce has allocated 13MT of oil product export quotas to seven oil companies under its first allotment for 2022, a decline of 56% compared to the 29.5M distributed during the first round in 2021, Reuters reported. These cuts come amid continued attempts from the Chinese government to curb excessive domestic refinery production as part of a wider plan to reduce carbon emissions. Additionally, the government has also issued 6.5MT of low-sulphur fuel oil export quotas, which is an increase of around 30% y-o-y.

Meanwhile, the OPEC+ coalition has agreed to maintain its existing plan of increasing collective oil production by 400K b/d in February, according to Argus. This decision comes despite concerns surrounding the impact of the Omicron COVID-19 variant on the global oil market, with the group forecasting that the strain will have a ‘mild and short-lived’ impact on demand.