SINGAPORE: China National Offshore Oil Corp (CNOOC), the country's third-largest oil company, has bought small volumes of diesel for delivery in late December for domestic use to help ease shortages.
Diesel purchases by CNOOC, parent of Hong Kong-listed offshore oil and gas specialist CNOOC Ltd , had been rare until September when it joined bigger state refiners PetroChina and Sinopec Corp in a rush of imports to cover a domestic supply squeeze of diesel fuel.
CNOOC was last known to have imported about 745,000 barrels of diesel in October to replenish thinning inventories as it closed its 240,000 barrels per day Huizhou refinery for a one-month maintenance.
The exact volumes purchased for December delivery could not be verified, but one source familiar with the matter said it was about 37,250 barrels bought from China's tax-bonded storage facilities that usually do not enter the Chinese market.
The volumes purchased will be used in the domestic market, a second source said.
Widespread diesel shortages are hitting southern China, with many filling stations posting "no diesel" signs ahead of high seasonal demand.
Supplies of diesel, the country's main transportation of fuel, have been tight in some regions for several months as refiners cut back output in the face of refining losses and maintenance.
Although Chinese refineries are running at full rates and state oil companies have increased diesel imports, there are still diesel shortages in some regions partly because refiners and dealers held back sales anticipating the government would raise retail fuel prices.
China imported 202,091 tonnes, or 1.51 million barrels, of diesel in November, up 37.7 percent from the same period last year, official customs figures showed on Wednesday.
State-owned refiners have not bought diesel for domestic use in the mainland for delivery in January yet, industry sources said.
They are awaiting next year's import quota set yearly by the government before deciding if and how much they should import.
"Everyone's doing de-inventory now and there's the quota issue as well," said a source with a Chinese refiner.
It is unclear when the new import quota for each state-owned refiner will be announced, traders said.
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