Thailand's crude imports jump in Oct as refiners replenish light-end product stocks

Hanoi — Thailand imported 792,600 b/d of crude and condensate in October, a 50.8% jump from a year earlier, with demand for light sweet crude from the US and Nigeria picking up sharply after the restart of the country's 215,000 b/d Rayong refinery.

The country's crude oil imports in October rose by 46.8% year on year to 725,673 b/d, while condensate imports more than doubled to 66,927 b/d from 31,263 b/d in the same month a year earlier, according to data released Nov. 23 by the customs department.

A sharp monthly increase in Thailand's refinery feedstock imports from its major light sweet crude suppliers including the US and Nigeria stood out, with state-run refiner and upstream company PTT indicating that the country is in need of replenishing some light and middle distillates stocks after refinery runs fell sharply late in the third quarter.

Thailand received 35,357 b/d of crude oil from the US in October, up 90.2% from 18,586 b/d imported in September, the data showed. Imports from Nigeria also more than doubled to 62,251 b/d from 24,655 b/d in September.

In the first 10 months, Thailand imported 92,951 b/d from the US, up 33% from the same period a year earlier, placing the North American producer in the top three supplier list for the year.

"Looking at the WTI-Dubai and WTI-Brent spreads, light sweet US crude may not be as competitive as it was in the previous 2-3 years, but we believe [crude import] diversification should be maintained over the longer run," a trading manager at PTT told S&P Global Platts.

Refinery runs

In mid-October, PTT's subsidiary IRPC Public Co. Ltd. competed repairs to its 215,000 b/d Rayong refinery and restarted units that were shut in early September due to a fire, a company official told Platts previously.

The operating rate of the Rayong refinery averaged 88% over the first half of 2020, down from the 94% in H1 2019, IRPC said in an operations update on Oct. 14.

With the units back online, however, market participants expect operating rates at the facility to be steadily increased to at least 80% of capacity, matching levels prior to the fire.

"Light crude and condensate are essential these days for petrochemical feedstock naphtha output ... demand for petrochemicals for plastic, as well as hygiene-related chemical production is rising rapidly during the [coronavirus] pandemic," a plant operation manager at IRPC said.

In addition, PTT Global Chemical plans to raise run rates at its 280,000 b/d refinery in Map Ta Phut to over 90% in December, from 80%-90% in November, due to some improvement in margins, a source close to the matter said Nov. 24.

However, it remain uncertain how far the country's refinery run rates would need to be increased as domestic transportation fuel demand remains fragile, industry and refinery sources said.

The ongoing political protests and fresh coronavirus outbreaks could emerge as challenges to Thailand's gasoline demand in the near term, sources added.

Reflecting the headwinds, driving activity in Thailand has been on a downtrend since the end of August and was seen at 7% below baseline levels Nov. 22, mobility data from Apple showed.

Domestic crude

Thailand produced 120,677 b/d of crude oil in the first nine months of this year, down 3.1% year on year, with major output coming from Sirikit (29,553 b/d, 0.4% higher year on year), Erawan (24,656 b/d, down 0.1% year on year) and Tantawan (17,984 b/d, down 15.5% year on year).

Its condensate output between January and September declined 16.6% year on year to 85,529 b/d, with the main production coming from Erawan (40,758 b/d, down 21% year on year) and Pailin (12,544 b/d, dropping 28.2% from a year ago), according to data released Nov. 12 by the Energy Policy and Planning Office.

Domestic crude production data for January-October is scheduled to be released next month.

Thailand's crude imports in October: (Unit: b/d)

Thailand's condensate imports in October: (Unit: b/d)

* Total includes other sources

Source: Customs Department, Energy Policy and Planning Office, Thailand