CHINA DATA: Nov crude throughput hits five-month high to 14.57 million b/d

Chinese refiners accelerated crude runs to their highest level in five months in November in response to Beijing's call to lift domestic supplies, but similar rates are unlikely to be sustained in December due to feeble winter demand, easing local prices and tighter export quota availability.

The country's crude throughput rose 5.5% month on month to 14.57 million b/d in November, National Bureau of Statistics data released Dec. 15 showed, as both state and independent refineries stepped up efforts to increase domestic oil product supplies.

It was the first time since July when China's overall monthly crude throughput rose above 14 million b/d. Both state-run and private refineries processed more crude in November.

S&P Global Platts data showed that average utilization rate of state-owned refiners -- Sinopec, PetroChina, CNOOC and Sinochem -- rose to 82.6% in November, from 80.6% in October, as they responded to Beijing's call for increasing oil product supplies at home.

Meanwhile, 43 independent refineries in Shandong also raised crude throughput by 3.7% from October to 2.21 million b/d in November, as refining margins remained attractive, data from local information provider JLC showed.

The integrated private refiner Zhejiang Petroleum & Chemical processed 647,000 b/d of crude in November, up 59.2% month on month. Its independent peer Hengli Petrochemical (Dalian) kept operation rate steady from October and cracked 401,000 b/d of crude last month.

The NBS releases data in metric tons and Platts converts it to barrels using a 7.33 conversion factor.

On a metric tons basis, China's overall throughput volume rose 2.1% month on month to 59.64 million mt in November. The country's throughput averaged 14.15 million b/d over the January-November period, up 5.2% year on year.

December throughput to fall

Robust runs are unlikely to be sustained in December as oil product prices have started to fall since late November, as demand softens due to the winter season, while lower export quotas will squeeze the scope to export oil products.

In addition, Shandong local government authorities are carrying out investigations on independent refiners on tax-related issues in December. This could cap throughput of those refineries.

S&P Global Platts analytics estimated China's crude throughput in December to fall 172,000 b/d from November, according to its monthly report dated Dec. 8.

"Our processing volume growth for 2022 is pegged at 512,000 b/d. This reflects a 638,000 b/d increase in demand and a 147,000 b/d drop in product exports. The increase in runs will also be supported by the ramp up of new refineries," Platts Analytics said in the report.

In the coming year or two, three to four refineries with a combined capacity of 1.2 million b/d of capacity are expected to expand capacity. This is expected at a time when Beijing is keen to slash oil product exports to cut carbon emissions.

Crude output rises

In the upstream sector, the country's crude output edged up 0.1% month on month to 3.99 million b/d in November. It was the third time during the year when production fell below the 4 million b/d mark, NBS data showed, after having fallen below that mark for the first time in July.

Domestic output was also up 2.7% year on year amid efforts by state-owned oil giants to increase domestic energy supplies.

China's crude output over January-November rose 2.8% year on year to 4 million b/d, the data showed.

China's crude output, throughput: (Unit: million mt)

Source: National Bureau of Statistics