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Refinery wars China, India win; S. Korea, Japan, Singapore lose

There is little doubt that China’s surging exports of refined fuels have cut profit margins for Asia’s refiners, but the pain is unlikely to be shared equally across all the region’s exporters of oil products.Given the scarcity of detailed official data on oil product imports and exports among many Asian countries, it’s nigh impossible to build a completely accurate picture of the likely winners and losers.

However, detailed data is provided by China on the export destinations of its product exports, and Australia, the region’s biggest importer of refined fuels, also gives a country-by-country breakdown of its imports.The overall picture for Asia’s refiners is that profit margins appear to have shifted structurally lower as a result of China’s massive exports of diesel and petrol.

With both China and India gaining increased shares of Australia’s open and competitive refined fuels market, this would seem to indicate that they are more competitive than refineries in South Korea, Japan and Singapore.Given both India and China have the most modern and presumably cost-efficient refineries in the region, it makes sense that they’re able to be more competitive.