China Refinery Runs Hit 2nd-Highest Mark, Lifted by Quotas, Margins
China's refinery runs rose nearly 12 percent in April compared with the same month a year ago, hitting the second-highest level on record on a daily basis, buoyed by generous government quotas and healthy refining margins, data showed on last Tuesday.
April throughput grew to 49.58 million tonnes, 11.5 percent higher than in the same month last year, according to data released by the National Statistical Bureau on last Tuesday, equivalent to 12.06 million barrels per day (bpd) - a touch below an all-time high of 12.13 million bpd in March.
Production in the first four months of the year totalled 199.12 million tonnes, up 9.1 percent from a year ago, according to the National Statistical Bureau. On a daily basis, average January-April runs stood at a near-record of 12.1 million bpd.
"The rapid growth in crude runs was due to big increases in crude oil import quotas and refined fuel export quotas," the bureau said in a statement.
Li Yan, analyst with Shandong-based Longzhong Information Group said the hefty refinery production level showed plants have been ramping up output on healthy margins, as the cargoes that arrived last month were purchased at a much lower price.
Global benchmark Brent crude futures have climbed to multi-year highs above $78 on Tuesday, bolstered by jitters about disrupted Middle East oil supply after the United States scrapped a 2015 Iran nuclear deal.
"Independent refiners have also become more deft in risk control - engaging in more hedging activities when prices were lower," said Li.
The lofty run levels came despite planned overhauls at a few state-run oil plants in April. More maintenance at both state-owned and independent plants are expected from May.
Refineries that shut in April include Sinopec's Tahe and Anqing refineries, and PetroChina's Sichuan refinery.
April's domestic crude oil production fell 2.3 percent from the same month a year ago to 15.51 million tonnes, or 3.774 million bpd, slightly higher than March's 3.76 million bpd.
Year-to-date output was 62.25 million tonnes, down 2.1 percent from January-April last year.
Natural gas production rose 6.3 percent in April over the year-ago level to 12.9 billion cubic meters (bcm). Output for the year so far was 52.6 bcm, up 4.0 percent.
Gas production growth has eased since March amid warmer weather.