Key facts
- China has partially lifted fuel export restrictions imposed earlier this year.
- Refiners are permitted to export 2.7 million tons of oil derivatives this month.
- The new quotas exclude destinations like Hong Kong and Macau.
- The easing of export caps is in effect for July, with possible rollovers to September.
- The quotas cover gasoline, diesel fuel, and jet fuel.
- Previous restrictions were imposed after the conflict in the Middle East led to the closure of the Strait of Hormuz.
China has partially eased its earlier imposed fuel export restrictions, allowing refiners to export 2.7 million tons of oil derivatives this month, excluding Hong Kong and Macau. This move comes as global fuel markets face a deepening supply crunch, exacerbated by conflict in the Middle East and the closure of the Strait of Hormuz. The temporary easing of export caps is effective for July, with provisions for rolling over unused volumes to September if purchase deals are not secured. The quotas encompass gasoline, diesel fuel, and jet fuel. Previously, in late June, reports indicated that the Chinese government would permit only 800,000 tons of refined fuels for export in July. The government had initially banned all fuel exports shortly after the Middle East conflict began, which effectively froze most traffic through the Strait of Hormuz, a critical global oil and fuel chokepoint. This action intensified an already severe fuel supply shortage. In April, China had previously relaxed export restrictions due to soaring domestic fuel stockpiles, which quelled concerns about domestic fuel supply security, partly due to a record crude oil reserve estimated at over a billion barrels at the onset of the Middle East war. June saw a significant surge in China's fuel exports, with fuel oil sales abroad climbing by 18% year-on-year to reach the highest level since early 2026, averaging 577,000 barrels daily amid a global demand for fuel to power ships.