China Refinery Output Hits Record on Strong Margins, Demand Recovery

SEATTLE (Oil Monster): China’s daily crude oil throughput in June climbed 9% from the same month a year earlier, hitting the highest level on record, as refiners ramped up processing on healthy margins amid a recovery in demand for gasoline and diesel.

China processed 57.87 million tonnes of crude oil last month, according to data released by the National Bureau of Statistics (NBS) on Thursday, equivalent to about 14.08 million barrels per day (bpd). That was up from 13.63 million bpd in May, beating the previous record set in December last year.

Throughput for the first half of this year totalled 319.09 million tonnes, equal to about 12.8 million bpd, up 0.6% from the same period a year ago.

Refiners cranked up processing in the second quarter as domestic fuel demand started to recover, after deep production cuts during February and March when the coronavirus outbreak peaked in China.

“Refinery processing was elevated in June as both state refiners and independents maxed out utilisation rates to capitalise on healthy margins,” said Chen Jiyao, a consultant with FGE, speaking ahead of the data release.

Diesel demand was supported by new construction projects and a boost in manufacturing activity, while gasoline consumption saw a further recovery from the pandemic in June when China’s Dragonboat festival holiday boosted driving, said Chen.

The NBS data also showed China’s crude oil output rose 0.7% in June compared with the same month a year ago to 16.24 million tonnes, or 3.95 million bpd. Output for the January-June period was up 1.7% year-on-year at 97.15 million tonnes.

Natural gas output last month rose 11.3% from a year earlier to 15.2 billion cubic metres (bcm), and was up 10.3% at 94 bcm for the first half of the year.

Courtesy: www.reuters.com