CHINA has issued a flurry of measures Friday aimed at promoting oil and commodities trading in seven new free trade zones, including granting more crude import quotas and establishing trading platforms, according to statements regarding two of them.

    The new free trade zones will be in Liaoning, Zhejiang, Henan, Hubei, Chongqing, Sichuan and Shaanxi, where free trade in commodities, especially in oil products will be promoted, according to a document issued ahead of a press conference in Beijing.

    In a statement regarding the new trade zone in eastern Zhejiang Province, the government said two to three companies will be allowed to apply for crude oil import quotas and plans for setting up a spot oil trading platform will be expedited.

    The Zhejiang trade zone is located in the coastal archipelago city of Zhoushan, already one of the country’s largest storage bases for petroleum. Privately run Rongsheng Holding Group is planning a mega greenfield refinery in Zhoushan.

    A Zhoushan-based industry executive involved in oil storage said the local commodity exchange will first trade fuel oil and liquefied natural gas, but added that oil firms remained skeptical over efforts to attract liquidity.

    Fuel blending and tax-bonded trade of marine bunker fuel will be encouraged in the 120 square-kilometer Zhoushan zone, according to a statement posted on the website of the State Council. Oil products futures may also be explored when the conditions are ripe, said the statement.

    A long-planned Shanghai crude oil contract, on the other hand, has been quietly shelved due to market resistance and the government’s concerns over capital outflows.

    Zhejiang will improve infrastructure including ports, pipelines, storage facilities, logistics and shipping, and encourage major oil-producing countries to invest in storage facilities as China aims to lift both strategic and commercial reserves held in the trade zone.

    Oil-producing nations and foreign energy companies are also encouraged to invest in refining projects in Zhejiang, China’s Cabinet said.

    In a separate statement, Liaoning Province in the northeast will also allow refiners in its new trade zone, spread across the cities of Dalian, Shenyang and Yingkou, to apply for crude oil import quotas, the Cabinet said.

    (SD-Agencies)