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Sinopec ... receiving four supertankers of US oil

Sinopec ... receiving four supertankers of US oil

Sinopec seeks US oil waiver


China Petroleum & Chemical Corp, or Sinopec, is seeking a tariff exemption for US oil being imported in coming months, sources familiar with the matter said, after Beijing late last week imposed retaliatory tariffs on US goods, including crude oil.

The largest refiner in Asia is expected to receive four supertankers carrying 8 million barrels of US crude at Tianjin in September and October, according to the sources, data from analytics companies Refinitiv and Kpler.

China announced its latest round of punitive tariffs against about $75 billion worth of American goods, adding US crude to the list for the first time with a 5 per cent tariff to take effect from September 1.

The tax is expected to increase the cost of a barrel of US crude by $3, the two sources familiar with the matter said.

Sinopec plans to seek tax exemptions from Beijing for its US crude oil imports, or store the oil in bonded storage for future sales if the waiver does not come through, they said.

Beijing has provided Chinese companies a channel to apply for tax waivers, the sources said.

The company is also weighing other options, which include temporary storage of US crude oil in bonded warehouse or sending the crude to other destinations, said one of the sources.

"It depends on how the communication (with the government) goes," said the other source.

The sources declined to be named as they were not authorised to speak to the media.

Sinopec declined to comment.

US crude futures hit its lowest in more than two weeks during Asian trade amid escalating trade tensions between the world’s two largest economies.

China’s move against US crude is expected to put upward market pressure on other varieties of crude.

"This is bearish for US grades, but bullish for Brent and Dubai price spreads as China seeks alternatives," Energy Aspects’ Singapore-based analyst Virendra Chauhan said.

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