03JUL2019 - NEWS - China’s Snapping Up a Little-Known Oil Product for Ship Fuel

As Chinese refiners struggle with low profits from turning oil into products like gasoline and plastics that have prompted run cuts across the country, a small corner of the market is having a moment. Imports of light-cycle oil, a by-product of crude that can be blended with diesel or fuel oil to increase volumes, surged in April and May. Its popularity is being driven by higher demand for diesel from shipping due to the introduction of rules prohibiting the use of dirtier fuels. Instead of buying costlier crude to make into diesel, refiners are mixing more LCO with it. Diesel use also typically rises in the second quarter due to the planting of rice and wheat.