China’s Oil Refining Rises to Record to Meet Shortage
China’s oil processing rose to a record last month after refiners increased production to ease a domestic fuel shortage.
Plants processed 37 million metric tons, or 8.8 million barrels a day, in October, up 12 percent from a year earlier, China Mainland Marketing Research Co., which compiles data for the National Bureau of Statistics, said in a statement from Beijing today. That exceeded the previous all-time high of 8.6 million barrels a day processed in June.
Chinese state oil companies are boosting processing in a bid to ease diesel shortages in the southern part of the nation caused by factories using the fuel to power their generators. China Petroleum & Chemical Corp., the nation’s largest oil refiner, increased production to a record in October, parent China Petrochemical Corp. said on Nov. 4.
“Refining volumes are set to rise even higher in the last two months of the year as state refineries maximize production,” Qiu Xiaofeng, an oil analyst with China Merchants Securities Ltd., said by telephone from Shanghai. “They are trying to ease the domestic shortfall.”
Diesel output gained 8.2 percent to a record 13.6 million tons last month, and gasoline rose 6 percent to 6.6 million tons. Kerosene climbed 4.2 percent to 1.4 million tons, according to today’s statement. Natural gas production rose 9.6 percent to 7.9 billion cubic meters in October.
Sinopec, or China Petroleum, and PetroChina Co., the nation’s top two oil refiners, said earlier this month that they will process record amounts of crude in November as the country battles a shortage that has left gas stations dry in the south and east.
More than 2,000 private retail fuel outlets in southern China closed after running out of diesel, Xinhua news agency reported Nov. 7.
The shortages helped Singapore’s benchmark gasoil crack spread, the profit from processing Dubai crude, climb above $14 a barrel, the widest since August, according to PVM Oil Associates, a brokerage.
China’s economy grew 9.6 percent in the third quarter, and industrial output gained 13.1 percent in October from a year earlier.
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