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China’s New Fuel Tax Has Refiners Scouring for Alternatives

  • Independent processors buying cargoes of straight-run fuel oil
  • Scrutiny on resale of crude allocations also prompts interest
Updated on

A new fuel import tax and Beijing’s crackdown on the reselling of crude quotas has China’s private refiners seeking alternative products such as straight-run fuel oil to process in their plants, according to traders.

At least two Shandong-based refiners have purchased straight-run fuel oil cargoes with arrival dates between mid-June to August, said traders with direct knowledge of the matter who asked not to be identified. That could be used as an alternative to diluted bitumen, which is set to be taxed, they said.