BEIJING: China's implied oil demand in November increased to the second highest in history, as refineries in the world's second-largest oil consuming country ramped up production to record high levels to ease domestic diesel shortages.
Implied oil demand, a combination of crude runs and net oil product imports, rose 1.7 percent from a year earlier to about 9.5 million barrels per day (bpd) last month, according to Reuters calculations based on preliminary government data.
The calculation does not include changes in inventories that China rarely publishes.
The daily volume was also 4.2 percent higher than in October, Reuters figures showed.
China's top two refiners, Sinopec and PetroChina, said in late October they would raise crude runs and increase imports as diesel shortages spread in parts of the country.
The country's crude oil imports rose 8.5 percent over a year earlier to 5.52 million bpd in November, the second highest on record on a daily basis. The daily rate was also nearly 13 percent more than in October.
The latest data from the customs department showed oil product imports in November rose to 3.35 million tonnes from 2.91 million tonnes in October, but exports also increased to 2.14 million tonnes from 1.59 million tonnes, resulting in a moderate reduction in net imports.
DIESEL SHORTAGES
Supplies of diesel, the main transportation fuel in China, have been tight in some regions for several months as refiners throttled back due to refining losses or maintenance. Sporadic diesel shortages spread after the government lowered gasoline and diesel prices on Oct 9.
Mounting refining losses at state oil firms have drawn skepticism from Chinese media about their efficiency and the merits of the country's fuel pricing system.
Refiners kept on drawing fuel stocks for the fifth month in a row in October, according to a report by the official Xinhua News Agency.
Even as China's refinery throughput jumped to a record last month, diesel tightness has occurred intermittently along with price changes of a basket of crude oils that China uses as a guide for setting fuel prices.
Analysts said fuel dealers tend to hold back sales when they expect the government is about to raise fuel prices soon.
On two occasions since November, a 22-day moving average price of the three crude oils -- Brent, Dubai and Cinta -- had crawled up to near 4 percent -- the change that could trigger a fuel price hike -- but it retreated to 3.07 percent as of Monday, according to consultancy C1 Energy.
Comments
Comments are closed for this article.