According to an uncredited domestic oil trader, this move is in order for the company to "divert output to help relieve a domestic supply squeeze."

"The domestic market is very tight. The 10,000 to 20,000 tonnes will just be meeting the term commitments. So far there is no plan to export spot barrels," said the trader, who also confirmed, "Sinopec would not need to buy any gas oil from the international market in January to cover its term export commitments."

The company was forced to buy 50,000 tonnes from the spot market in December to cover export commitments.

This limiting of exports marks a significant drop from Sinopec's usual export volume. The company exports 80% of China's oil and gas.