Beijing’s Plan to Cut Oil Refining Capacity Stumbles in Regions

“Build the new before abolishing the old” could be written on the tombstone of China’s pledge to fix its problem with industrial overcapacity.

The Politburo slogan has been adopted by the Shandong government, among others, as one piece of the solution to its oil refining glut. The province houses most of the smaller, independent processors that make up over a fifth of China’s capacity. Barely profitable, the so-called teapots are first in the firing line as Beijing wages its so-called anti-involution campaign against cutthroat competition in the oil industry.