CHINA DATA: Crude throughput rises 0.8% on month to 13.8 mil b/d in October

China's crude throughput rose 0.8% to 13.81 million b/d in October from a 17-month low in September, showed data released by the National Bureau of Statistics Nov. 15.

"[The higher throughputs were] mostly driven by a tight gasoil market, given these players often have higher yields and a general edge selling to the wholesale market," said Grace Lee, Senior Analyst with S&P Global Platts Analytics.

In Shandong province, refining margins for cracking imported crudes more than doubled to a record Yuan 1,185 ($182)/mt in October, rising 123.6% on the month, local information provider JLC's data showed.

A feedstock supply shortage for private refiners eased after the release of the final round of 2021 crude import quota allocations, enabling them to boost throughput.

On Oct. 15, Beijing allocated the last batch of crude quotas to 16 qualified refineries at 14.89 million mt. An additional quota of 12 million mt for Zhejiang Petroleum & Chemical's 20 million mt/year phase 2 project was allocated Oct. 25.

As a result, throughput of the private integrated Hengli Petrochemical (Dalian), ZPC and the small-sized independent refineries in Shandong rose 2.2% month on month to 3.19 million b/d.

Sinopec and PetroChina led the state-owned oil sector in raising throughput in end October as a response to Beijing's call to ensure gasoil supply. The state-run refiners had previously planned to their drop average utilization rate to 80.5% from 81.5% in September, Platts reported earlier.

The NBS releases data in mt, which Platts converts to barrels using a conversion factor of 7.33. On a mt basis, the volume rose 4.2% on the month to 58.4 million mt in October.

Crude throughput remained 3% below the 14.24 million b/d recorded in October 2020, slowing the year-to-date growth rate over January-October to 5.5% from 6.6% over January-September. China processed 585.15 million mt, or 14.11 million b/d, of crude over January-October, the data showed.

Nov throughput supported

In November, China's crude throughput would be supported by the state-owned refineries' commitment to increase gasoil supply. In late October, Sinopec had announced that it would run its refineries at full capacity while adjusting yield to raise gasoil supply 18% on the month in November.

PetroChina followed by increasing gasoil supply in November and December by 50% from the average level over January-August. ZPC will also raise its utilization rate for the rest of the year from 70% in October to maximize usage of its new crude import quota.

Shenghong Petrochemical's 16 mil mt/year greenfield refinery is expected to start its trial run by the year end, which would contribute some throughput. China's crude throughput for 2021 is estimated to rise 3.7% to 14.2 million b/d, Platts Analytics reported earlier.

Upstream, China's crude output fell 1.9% on the month to 3.98 million b/d in October, marking the first time after July that production had fallen below 4 million b/d in 2021.

The volume represented a 3% year-on-year growth amid efforts by state-owned oil giants to increase domestic energy supplies. As a result, crude output over January-October rose 2.8% on the year to 4.01 million b/d, the data showed. China's crude output is expected to be at 4.06 million b/d in 2025, according to a senior official with CNOOC.

China's crude output, throughput:

(Unit: million mt)

Source: National Bureau of Statistics