China’s Sinochem to import rare MR cargo of 92 RON gasoline from Singapore
State-owned Chinese trader Sinochem has bought an MR cargo of 10 ppm 92 RON gasoline from Shell for loading from Singapore and delivery to China, several Singapore-based sources said Friday.
The rare move follows an open arbitrage window, high domestic demand, and the availability of import quotas.
“Product imports would yield a high profit after taxes and fees as China tightening emissions requires more high quality fuels that meet National Phase 6 standards. This has encouraged Chinese oil companies to buy from the Asian market,” a Beijing-based trader said.
Wholesale 92 RON 10 ppm gasoline was offered at a post-tax price of Yuan 8,900/mt ($153.16/b) in Guangzhou on Friday, capital of Guangdong province in Southern China, according to local traders.
The price was Yuan 400/mt higher than a week ago due to tight supply ahead of the peak consumption period over September-November.
The wholesale price translates into $94.78/b excluding taxes and fees.
Meanwhile, Platts assessed FOB Singapore 10 ppm 92 RON gasoline at $85.65/b on Thursday, offering an opportunity for arbitrage from Singapore to China.
Beijing awarded import quotas for 300,000 mt of gasoline and 500,000 mt of gasoil to the state-owned Sinochem and Sinopec recently. This was to ensure sufficient supply ahead of the deadline for adopting National Phase 6 emission standard, similar to Euro 6, across the country from January 1, market sources said. Sinochem was able to import the gasoline cargo as a result.
Late last month, it fixed a 40,000 mt cargo of gasoil cargo from the Asian market for delivery to South China’s Guangdong province in early September, Platts reported earlier.