Chinese Refiner Wepec Sells H1 Nov Gasoil, First Parcel This Year

Chinese refiner West Pacific Petrochemical Corp., or Wepec, has sold it first gasoil cargo for 2012 -- a 0.2% sulfur gasoil parcel for H1 November loading at a discount of 40-50 cents/barrel to Mean of Platts Gasoil assessment to PetroChina via private negotiations -- trading sources said Thursday.

The parcel was done on a FOB Dalian basis. "At that current cash differential level, it will probably stay around China or head to Hong Kong," a trade source said.

Further, the gasoil parcel is believed to be the first such export by the Chinese refiner this year, traders said.

Wepec typically exports gasoline, naphtha, jet fuel and kerosene cargoes.

Meanwhile, China could see a massive spike in gasoil exports in Q4 amid steady refining run rates and slower demand in the county, traders said. Surplus coal stocks could also minimize gasoil demand as a utility feedstock. PetroChina and Unipec could see their gasoil exports hit or even surpass 300,000 mt/month in Q4, compared with 107,000 mt/month a year earlier, traders said.