China's Sinopec Corp , the country's sole major diesel exporter, will resume overseas shipments of the fuel next month after a brief halt in January as a domestic shortage ended, traders said on Tuesday, Reuters reports.
Two sources familiar with Sinopec's trading activities said the top Asian refiner was looking to ship out about 100,000 tonnes of diesel in February, or a little over a third of its monthly average sales in most of 2010.
"Domestic demand in February will be low for at least 10 days during the Chinese New Year break. We are working out the export programme now," said a Sinopec trader, who, however, declined to specify the volume.
Traders had earlier expected the refiner to resume exports in March.
China started to slash exports from November while raising imports of diesel, to quench a fuel squeeze caused by small industries scrambling for stand-alone diesel generators after being cut off the state power grid.
The shortage has eased significantly since December, after state refiners also boosted production to record rates and as independent fuel dealers brought in a rare fuel called "power kerosene" to blend for diesel.
Sinopec's move to resume diesel exports was partly driven by a temporary consumption ebb during the week-long Lunar New Year break staring Feb. 2. Traders said sales to a relatively strong Asian market were a sensible business decision.
China is expected to hold back from importing diesel for the first quarter of the year, after inbound shipments hit a 27-month high in December as firms rushed to plug a domestic shortage.
Traders said China's resumption of exports in February might have a mild knee-jerk negative impact on Asian gas oil sentiment, but it would be more psychological than fundamental.
"It does mean the gas oil market will not be as well-supported as during the November to December period when China stopped exports and started importing," said a distillates trader with an Asian firm.
"There could be some knock-on effect on sentiment, but it won't be significant because the volume is not huge by any measure," he added.
Another trader also agreed the February exports would have an insignificant market impact.
"China exported 235,000 tonnes in November, 172,000 tonnes in December, and 292,000 tonnes in the February of last year, according to official customs data, so 100,000 tonnes this February is not a big deal, and the market impact is not likely to be significant." he added.
Two sources familiar with Sinopec's trading activities said the top Asian refiner was looking to ship out about 100,000 tonnes of diesel in February, or a little over a third of its monthly average sales in most of 2010.
"Domestic demand in February will be low for at least 10 days during the Chinese New Year break. We are working out the export programme now," said a Sinopec trader, who, however, declined to specify the volume.
Traders had earlier expected the refiner to resume exports in March.
China started to slash exports from November while raising imports of diesel, to quench a fuel squeeze caused by small industries scrambling for stand-alone diesel generators after being cut off the state power grid.
The shortage has eased significantly since December, after state refiners also boosted production to record rates and as independent fuel dealers brought in a rare fuel called "power kerosene" to blend for diesel.
Sinopec's move to resume diesel exports was partly driven by a temporary consumption ebb during the week-long Lunar New Year break staring Feb. 2. Traders said sales to a relatively strong Asian market were a sensible business decision.
China is expected to hold back from importing diesel for the first quarter of the year, after inbound shipments hit a 27-month high in December as firms rushed to plug a domestic shortage.
Traders said China's resumption of exports in February might have a mild knee-jerk negative impact on Asian gas oil sentiment, but it would be more psychological than fundamental.
"It does mean the gas oil market will not be as well-supported as during the November to December period when China stopped exports and started importing," said a distillates trader with an Asian firm.
"There could be some knock-on effect on sentiment, but it won't be significant because the volume is not huge by any measure," he added.
Another trader also agreed the February exports would have an insignificant market impact.
"China exported 235,000 tonnes in November, 172,000 tonnes in December, and 292,000 tonnes in the February of last year, according to official customs data, so 100,000 tonnes this February is not a big deal, and the market impact is not likely to be significant." he added.