ANALYSIS-China fuel import surge may vanish after Olympics

By Felicia Loo

SINGAPORE, April 28 (Reuters) - The surge in China's gasoline and diesel imports this year has given an unexpected fillip to world oil prices, but that extra demand may vanish this autumn as Beijing unwinds a series of pre-Olympic measures.

To ensure its summer Olympics in August run smoothly, China has invoked national duty to spur its big oil companies to stock up fuel supplies, causing a short-term blip in imports that has turned it into a net gasoline importer for the first time.

They've also given refiners big rebates on imported crude and fuel supplies rather than risking social disharmony by raising ultra-low state-set domestic pump prices -- a measure that might dampen demand from the world's No. 2 consumer.

Both will likely change after the Olympic flame dies out, say analysts. And new refineries now under construction should again make China self-sufficient in both fuels.

"The surge in fuel imports was to calm the domestic markets that a product shortage would not be a possibility. It was more of a preventive act to restrain hoarding than a reaction to run-away demand growth," said Joy Siew, consultant with Boston-based Energy Security Analysis, Inc.

Some of that extra demand will reappear in the form of crude imports as new refineries crank into action, but analysts still expect to see overall more sluggish growth in the second quarter, removing one bullish element from the global market.

In March, demand rose by 8 percent, its fastest in 19 months, data released last week showed. [ID:nPEK292273]

China reminded its wholesalers last week that they must keep stocks equivalent to 15 days of sales under new rules that come into force on May 1, more than the 10-day norm. [ID:nPEK170784]