China’s crude pro­cess­ing runs at record level

Oc­to­ber saw 7.4% in­crease while nat­u­ral gas out­put rose 15%

Global Times - - Biz Markets -

China’s re­fin­ers raised crude oil pro­cess­ing runs to near record monthly lev­els in Oc­to­ber as re­fin­ing mar­gins jumped af­ter the coun­try’s State plan­ner hiked prices for gaso­line and diesel at the pump.

Also on the rise last month, ac­cord­ing to data re­leased by China’s statis­tics bureau on Tues­day, was the coun­try’s nat­u­ral gas pro­duc­tion – jump­ing 15 per­cent to a seven-month high as oil ma­jors ramped up out­put to meet grow­ing win­ter de­mand spurred by the Chi­nese gov­ern­ment’s squeeze on the use of coal for heat­ing.

The data showed crude runs rose 7.4 per­cent in Oc­to­ber to 50.51 mil­lion tons, or 11.89 mil­lion bar­rels per day (bpd), eas­ing off the record pace of 12 mil­lion bpd set in Septem­ber.

For the first 10 months of the year, re­fin­ery out­put rose 5 per­cent from the same pe­riod a year ear­lier to 468.92 mil­lion tons, or 11.26 mil­lion bpd.

“Through­put rose strongly as re­fin­ers ex­pect mar­gins to firm, with the gov­ern­ment rais­ing re­tail fuel prices in tan­dem with spikes in the global crude oil mar­ket,” said Seng-Yick Tee, se­nior di­rec­tor at Bei­jing-based SIA En­ergy.

China’s State plan­ner, the Na­tional De­vel­op­ment and Re­form Com­mis­sion (NDRC), raised both gaso­line and diesel re­tail prices by 150 yuan ($22.60) per ton on Novem­ber 2, the sec­ond price hike in two months. The higher prices have boosted mar­gins for both State-owned and in­de­pen­dent re­finer­ies.

The NDRC is set to ad­just re­tail prices again on Thurs­day, with an­a­lysts and re­fin­ers fore­cast­ing an­other big hike.

Mean­while, nat­u­ral gas out­put rose 15 per­cent in Oc­to­ber from the same month a year ago to 12.4 bil­lion cu­bic me­ters, the high­est since March.

Oil ma­jors are ramp­ing up do­mes­tic gas pro­duc­tion at key fields like Changqing gas field in North­west China’s Shaanxi Prov­ince, and also boost­ing im­ports of pipe­line gas and liq­ue­fied nat­u­ral gas.

De­mand for the cleaner fuel is set to grow at the fastest pace since 2011, spurred by the Chi­nese gov­ern­ment’s gasi­fi­ca­tion drive.

Oc­to­ber do­mes­tic crude oil pro­duc­tion inched down 0.4 per­cent year-on-year to 16.01 mil­lion tons, hov­er­ing close to Au­gust’s record monthly low.

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