After a slow start hit by a pandemic in 2020, China’s refineries increased production from April, thanks to ultra-low crude oil prices and a recovery in the Chinese economy and fuel demand, setting a new record for processing volumes of crude oil.
Crude oil production at China’s refineries averaged 674.41 million tons, or 13.51 million barrels per day (bpd), in 2020, an increase of 3.2% over the previous year for a volume of record processing, according to data from the National Bureau of Statistics cited by Argus.
Last year, when international crude oil prices plummeted in March, April and much of May, Chinese refiners took advantage of the lowest prices in years and stocked low-priced oil. For several months, China broke import records for crude oil over the summer, and tankers had to wait weeks to unload the oil as congestion at ports increased.
Several new refining units also contributed to China’s record crude oil processing rates in 2020, as well as the higher import quotas given to independent refiners – so-called teapots – by the government.
According to data from the Chinese statistics bureau cited by Argus, Chinese refineries reduced crude oil production between January and March, with March production falling 6.6 percent year on year. In April, however, refineries began to accelerate crude oil processing, which reached a daily record in November – of 14.2 million bpd, an increase of 3.2 percent over November 2019. Yield The refinery’s average in December was only slightly lower – from 14.18 million bpd, close to the record levels of November, according to Argus’ estimates.
Crude oil imports from China also increased to a record 10.85 million bpd on average in 2020, up 7.3 percent, due to cheap oil prices and the start-up of several refineries.
For most of last year, solid demand in China alone supported the oil market, while demand in Europe and the United States was decreasing with the resurgence of COVID-19 boxes.
By Tsvetana Paraskova for Oilprice.com
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