China July gasoline exports to North Korea almost wiped out

BEIJING: China’s gasoline exports to North Korea evaporated to a dribble in July, according to customs data, the strongest sign yet that the suspension of sales of the fuel by state oil major CNPC has cut critical supplies to its isolated neighbour.

Beijing’s General Administration of Customs said on Wednesday Chinese shipments of gasoline dropped 97 per cent from a year ago to just 120 tonnes of the fuel – worth little more than US$100,000. The number was down from 8,262 tonnes in June.

Monthly fluctuations in the data are not unusual, but this was the fourth-lowest volume on Reuters’ records of customs data going back to January 2010.

Customs data also showed China’s trade with North Korea fell last month as a ban on coal purchases from its isolated neighbour slowed imports amid growing pressure from the United States to rein in Pyongyang’s missile programme.

A prolonged supply cut would threaten critical supplies of fuel and could force North Korea to find alternatives to its main supplier amid international pressure on Pyongyang to curb its nuclear and missile programmes.

At the end of June, Reuters reported China National Petroleum Corp (CNPC) suspended sales of gasoline and fuel to North Korea over concerns CNPC would not get paid for its goods.

Fuel prices in the country surged following the cut and the measure is still in place, people familiar with the matter say.

“This confirms that CNPC has truly stopped supplies,” said one Beijing-based trading source familiar with China’s oil transactions with North Korea.

“The amount is so small, it’s what would typically be lost during transportation.”

Gasoline typically accounts for the bulk of fuel exports to North Korea, but July data showed the biofuel, ethanol, took the top spot with shipments of 4,137 cubic metres, worth US$1.9 million.

Meanwhile China’s iron ore imports from North Korea fell sharply in July, the month before the United Nations passed a vote to impose tougher sanctions on Pyongyang.

The United Nations Security Council unanimously imposed new sanctions on North Korea targeting its exports of coal, iron ore, lead, lead ore and seafood in sanctions to take effect in early September.

Arrivals of iron ore fell 24.5 per cent in July from the same month a year earlier to 175,980 tonnes.