China Dec fuel oil imports jump ahead of tax hike

China's fuel oil imports in December (2008) surged 115.5 percent from a year earlier as buyers rushed to ship in the fuel before a fuel tax hike took effect on Jan. 1.

Preliminary data from the General Administration of Customs showed that the country imported 2.64 million tonnes of fuel oil, 90 percent higher than in November.

The volumes were largely in line with an earlier Reuters report.

Fuel oil is mainly used by independent refiner as feedstocks or fuel for some industrial users.

But diesel imports slumped 90.1 percent to 80,000 tonnes last month while exports increased 682.7 percent to 200,000 tonnes, Customs said, with oil firms eager to draw down their hefty stockpiles due to weakening demand amid the economic downturn.

Gasoline imports also fell 60.8 percent to a mere 7,025 tonnes in December and exports surged 68.4 percent to 250,000 tonnes.

For the year, however, gasoline imports were still 775.3 percent higher than in 2007 while diesel imports rose 285.0 percent, mainly because of the buying spree ahead of the summer Olympics.

China raised consumption tax on fuel oil by sevenfold on Jan. 1 as part of a wider tax and fuel-pricing reform that was intended to encourage fuel efficiency and bring local fuel prices more in tandem with international price changes.

Beijing cut gasoline and diesel prices by a few percent on Thursday in the first adjustment since, a move that analysts said could herald more frequent price changes in future.