Economics
China Car Fever Lifting Gasoline Seen as Root of Diesel Glut
- Bank of China International sees `product mismatch' in market
- As gasoline output used domestically, surplus gasoil exported
This article is for subscribers only.
China’s love of cars and the gasoline that runs them is exacerbating an oversupply in another fuel decried by refiners across Asia, according to Bank of China International.
While refineries in the world’s biggest auto market process more oil to feed demand for motor fuel, they also end up producing diesel, which is being used less because of shrinking Chinese industrial activity, Xiao Fu, head of commodity markets strategy at the bank, said in an interview. Amid this “product mismatch,” excess gasoil is being shipped overseas, flooding regional markets and affecting profit margins, according to Fu.