China's refinery output falls for a fifth month as fuel demand disappoints
- Aug crude runs down 6.2% y/y at 59.07 MMt
- Jan-Aug throughput down 1.2% y/y at 472.53 MMt
- Aug natural gas output up 9.4% at 20 Bm3
- Jan-Aug natural gas output up 6.6% at 163.7 Bm3
China's oil refinery output in August fell 6.2% from a year earlier, official data showed on Saturday, declining for the fifth month as disappointing fuel demand and weak export margins curbed production.
Refiners processed 59.07 MM tonnes of crude oil last month, data from the National Bureau of Statistics (NBS) showed, equivalent to 13.91 MMbpd.
The August level inched up from July's 13.908 MMbpd, which was the lowest since October 2022, and off a hefty rate of 15.23 MMbpd a year earlier.
Output for the first eight months of the year was 472.53 MMt, or 14.14 MMbpd, down 1.2% from the corresponding period last year, the data showed.
While Chinese diesel fuel demand has been weighed down by a broad economic slowdown and greater replacement by cheaper liquefied natural gas (LNG) as a truck fuel, gasoline consumption has been below expectations despite a seasonal demand uptick.
"Although gasoline use hits a peak season as more people take to the roads, overall use of the motor fuel is below year-ago levels," Sublime China Information, a local commodities consultancy, wrote in a market summary early this week.
China's gasoline demand is expected to peak in 2025, a China oil researcher told an industry gathering in Singapore earlier this week, as EV penetration has exceeded the government's target and is set to reach 40% of new car sales this year.
Planned maintenance at Sinopec's Jinling and Tianjin refineries and PetroChina's Ningxia and Jilin plants capped throughputs at state majors, according to consultancy Oilchem.
Softening export margins for gasoline and middle distillates also discouraged state refiners to process more.
Throughput at independent refiners, however, saw a modest rebound last month thanks to a small improvement in refining margins.
Shandong-based plants operated at an average of 56.4% of their capacity in August, up 2.2% versus July but remained 10% below year-ago levels, according to Sublime China Information.
Saturday's NBS data also showed China's crude oil production in August rose 2.1% from a year earlier to 17.83 MMt, or about 4.2 MMbpd. Year-to-date output grew 2.1% on the year to 142.79 MMt, or 4.27 MMbpd.
Natural gas production maintained healthy growth, rising last month by 9.4% from a year earlier to 20 Bm3 and output between January and August grew 6.6% at 163.7 Bm3.
(1 tonne = 7.3 bbl of crude oil)
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