Brent crude climbed above $100 a barrel on Thursday after Chinese refiners suspended fuel exports for October, according to Reuters , piling pressure on energy markets already disrupted by the U.S.-Iran war and Ukraine's attacks on Russian refining infrastructure. Brent crude with December expiry was last trading 2.2% higher at $100.15 per barrel, having earlier fallen 1%, while U.S. West Texas Intermediate with November expiry rose 1.5% to $91.74.
Beijing began a week-long national holiday on Thursday without issuing export permits to major refiners, allowing shipments only to Hong Kong and Macau, according to Reuters, citing four unnamed sources. The sources said they could not confirm whether export permits would be granted again once the holiday concludes on October 7, noting that domestic fuel inventories and refining output would probably factor into any decision.
PetroChina, the state-owned oil giant, scrapped several October cargo commitments for gasoline and jet fuel, Reuters reported. Privately held Zhejiang Petrochemical Corp also scheduled no oil product shipments during the holiday week.
Beijing restricted fuel exports in March after the Iran war disrupted Middle Eastern crude supplies, then relaxed those curbs in July and began managing diesel, gasoline, and jet fuel shipments on a monthly basis. Commercial gasoil and diesel inventories sit roughly 20 million barrels below the threshold Beijing has set for permitting exports, with gasoline about 9 million barrels short, according to Reuters, citing Zameer Yusof, a senior manager for clean oil products at data firm Kpler.
Michal Meidan, who leads China energy research at the Oxford Institute for Energy Studies, said that the suspension reflected Beijing's prioritization of domestic fuel supply. "International markets are an afterthought," Meidan said.
The suspension follows Chinese President Xi Jinping's trip to Washington, during which President Donald Trump pressed Xi to help bring global fuel supplies under control. The Trump administration has told Germany and France to draw down emergency diesel inventories or face a potential U.S. diesel export ban. According to the outlet, Energy Secretary Chris Wright said diesel exports from the Middle East and China had been lost to global markets, and that Washington was anticipating announcements from Europe regarding new diesel supplies.
The suspension adds to an already strained supply picture. The Trump administration issued a solicitation Tuesday for the final 40-million-barrel tranche of a 172-million-barrel Strategic Petroleum Reserve release authorized in March, part of a broader International Energy Agency drawdown. U.S. diesel prices have reached a record roughly $6.50 a gallon — about 70% above pre-war levels — while gasoline averages around $4.45 a gallon nationally.
Concerns about crude availability have softened since Saudi Arabia brought its East-West Pipeline back online and tanker departures from the Red Sea terminal at Yanbu picked up again, offering an alternative route around the Iran-blocked Strait of Hormuz.
