China's May crude runs drop from peak
China’s crude oil throughput in May rose from a year earlier but eased from a record reached in April, government data showed, as refiners curbed output amid weakening fuel demand.
Crude throughput last month climbed 2.8% from a year earlier to 51.9 million tons, or 12.22 million barrels per day (bpd), data from the National Bureau of Statistics (NBS) showed. That compared to an all-time high in April of 12.68 million bpd.
Seng Yick Tee, senior director of consultancy SIA Energy said lackluster domestic fuel demand, for gasoline in particular, prompted refiners to curb production amid weakening margins.
The refinery throughput, the lowest in four months on a daily basis, also occurred as industrial output growth unexpectedly slowed to a more than 17-year low in May.
China’s new car sales declined for the 11th month in a row in May due to a lack of consumer confidence in a slowing economy.
“The negative growth in the auto-making industry is slowing China’s incremental fuel demand,” said Tee.
Refinery throughput in China, the world’s biggest oil importer and second-largest consumer, is expected to rise as two new plants start up.
Privately owned Hengli Petrochemical ramped up its new 400,000-bpd refinery to full operation in late May, while similar-sized Zhejiang Petrochemical also started trial runs last month.
For the first five months of the year, Chinese crude throughput rose 4.4% from a year earlier to 259.49 million tons, the NBS reported. The NBS data also showed China’s crude oil production in May climbed 1% from a year earlier to 16.23 million tons, or about 3.82 million bpd. That was flat from April.
Output in the January to May period increased 0.7% from a year earlier to 79.29 million tons, as national oil majors stepped up drilling amid a government call to boost domestic supply security.
Natural gas output was 14.4 billion cubic meters (bcm) in May, 12.9% higher than a year earlier.
Output in the first five months expanded at a robust 9.8% from a year ago to 72.5 bcm. Natural gas output increased faster than crude oil as state companies prioritized increases in spending on the cleaner burning fuel to meet strong demand growth.
ton = 7.3 barrels for crude conversion Reporting by China energy team; Editing by Joseph Radford and Christian Schmollinger
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