CHINA DATA: April crude throughput hits 44-month low of 13.35 mil b/d

China's crude throughput dropped by 5.8% year over year to a 44-month low of 13.35 million b/d (54.65 million mt) in April, data from the National Bureau of Statistics showed on May 18.

The slump was within expectations amid the supply disruption in the Middle East, while high fuel prices dampened domestic demand, Platts, part of S&P Global Energy, reported earlier.

As a result, China's apparent crude stocks rose by 430,000 b/d in April despite crude imports falling 20% year over year to a 45-month low of 9.4 million b/d, given domestic crude production gained 1.2% year over year to 4.38 million b/d (17.94 million mt), according to data from NBS and the General Administration of Customs.

According to Ursa Space data, China's onshore crude inventory reached a record high of 1.36 billion barrels in April and stayed at similar levels as of May 18.

A London-based analyst said China may not even need to draw on its hefty crude inventories to survive the Middle East supply crisis, given its energy resilience. "We see China is comfortable with crude throughput at about 13.5 million b/d. A stable crude output at around 4.2 million b/d, coupled with about 9.5 million b/d of crude imports amid supply disruption in Middle East, can cover the throughput without crude stocks draw," the analyst said.

China's crude throughput in May is likely to remain low as independent refineries cut runs amid poor margins. According to local information provider JLC, refining margins for processing imported crude were at a loss of Yuan 1,207/mt ($24.26/b) as of May 13, widening further from an average loss of Yuan 401/mt in April.

Due to weak demand amid high fuel prices and record-low exports, China's gasoline and gasoil inventories rose in April despite a reduction in crude throughput. Gasoline inventory rose 7% month over month to 10.31 million mt (87.64 million barrels) on April 30, while gasoil stocks gained 4% from end-March to 13.45 million mt (100.20 million barrels), according to JLC.

In January-April, Chinese refineries processed 14.6 million b/d of crude, down 0.5% year over year. Crude output rose 1.3% to 4.44 million b/d in the first four months, NBS data showed.

Middle East supply crisis hits industrial output

The supply crisis in the Middle East, however, has weighed on China's industrial output due to high feedstock and energy prices, a market analyst said.

Ethylene output fell 4.1% year over year to 3.15 million mt in April, compared to a 6.8% year-over-year increase to 3.64 million mt in March, NBS data showed.

Sinopec said in late April that producing ethylene from naphtha was incurring deep losses, while state-run refineries raised oil product yields to maintain domestic supply and cut chemical production amid lower crude throughput.

Meanwhile, automobile production fell 2.6% year over year to 2.56 million units in April, according to NBS data. As new energy vehicle production rose 3.8% year over year to 1.3 million units, the market analyst said it suggested a significant reduction in internal combustion engine vehicles as fuel prices rose.

Adding to the reductions in crude oil throughput, cement production and steel output, China's industrial production rose 4.1% year over year, the lowest growth since 3.7% in July 2023, NBS data showed.