Gasoline import margin for Chinese importers was still in negative territory, although the margin improved somewhat on the government’s cut in import tariff.
In Singapore market, FOB price of 92-Ron gasoline, which has similar specifications with 93-Ron gasoline in China, was US$116.5/bbl on average during Jun 24-Jul 7, versus the average of US$119.5/bbl two weeks ago.
Calculated by the latest price, import cost of the fuel was Yuan 9,479/mt, with freight rates and taxes inclusive, Yuan 289/mt higher than wholesale prices of 93-Ron gasoline in South China. The cost was Yuan 667/mt higher than domestic sales two weeks ago.
If calculated by US$116.5/bbl of gasoline price in Singapore, Chinese refineries could reap about Yuan 6,422/mt of earnings by exporting 93-Ron gasoline to Singapore under processing trade when excluding freight rates. The refineries could get Yuan 6,295/mt, about Yuan 127/mt lower, by selling such resources in domestic market if calculated by Yuan 8,989/mt of ex-refinery price from Sinopec Guangzhou Petrochemical, with Yuan 1,388/mt of consumption tax and 17% value-added tax deducted. Export earnings were Yuan 296/mt higher than domestic sales two weeks ago.
China may not import a large amount of gasoline in the near term because of still negative import margin and sufficient supply in the domestic market, market sources predicted.
