A Glance of China Oil Market 20260216

Weekly News

China Feb gasoil consumption falls to annual low, down 12% YoY

According to OilChem's tracking and historical experience, China's gasoil consumption is expected to record the annual low in February during the Chinese New Year (CNY) holiday, while the production is estimated to remain modest with state-owned refineries raising CDU capacity utilization rates on gasoline demand peak during the holiday. In detail, China's gasoil consumption is estimated at around 442,900 tonnes/day in February 2026, down 18.40% from the previous month and 12.18% compared with the same period last year, based on OilChem's analysis. Read Full Story

China approves first bonded biofuel blending pilot in Zhoushan

China has formally approved its first pilot allowing bonded blending and export of marine biofuel oil, with Zhoushan designated as the testing ground. Alongside the approval, regulators have rolled out a dedicated supervision framework, marking a concrete step from policy experimentation toward commercial implementation. The most immediate impact is a structural reduction in operating costs. According to fuel suppliers' estimates, local bonded blending is expected to reduce costs by around USD 80 per tonne compared with traditional import-based routes. Read Full Story

Hainan's customs closure reshapes access and margins for energy and chemical sectors

In December 2025, China officially sealed the Hainan Free Trade Port, triggering full enforcement of its zero tariff, low tax rate, simplified tax system regime. While this marks a milestone for national-level institutional opening, the impact on energy and chemical markets will be far from universal. Rather than blanket tax exemptions, Hainan's customs closure introduces a filtered set of incentives that favor high-value manufacturing and offshore circulation, while decisively shutting out low-end processing and arbitrage flows. Read Full Story