(April 2): Chinese officials have told private refiners to keep fuel production at 2025 levels — even if they have to incur economic losses as a month-long war in the Middle East upends the global crude oil trade.
At meetings earlier this week, the National Development and Reform Commission (NDRC) told executives from the country’s private processors that securing domestic fuel supply was a priority, which means producing gasoline and diesel at volumes at least equal to last year — at any cost, people familiar with the discussions said.
Any refineries that cut run rates and produce lower volumes will have their oil import quotas cut accordingly for the coming years, the people said. They asked not to be named as the discussions are not public.
The NDRC didn’t immediately respond to a faxed request for comment.
Chinese independent refiners, known as teapots, have been under pressure since the start of war, given their reliance on heavily discounted sanctioned oil from Iran, Russia and Venezuela. The cheaper crude, which larger refiners tend to eschew, has helped navigate a period of paper-thin refining margins. But the bargains all but disappeared after the US issued temporary waivers on curbs on Tehran and Moscow.
Chinese independent refiners have cut run rates to under 63% of capacity in the week to April 1, the lowest since August 2025. Their refining margins were in red this week, recording the worst performance since 2024, according to data tracked by JLC International Ptd Ltd.
See also: Oil jumps after Trump flags Iran war escalation in coming weeks
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