Platts Report: China Oil Demand Rises 3.5% in November from Year Ago

China Becomes Net Exporter of Oil Products over January-November

Dec 23, 2014, 23:30 ET from Platts

SINGAPORE, Dec. 23, 2014 /PRNewswire/ -- China's apparent oil demand* in November rose 3.5% year over year to 42.18 million metric tons (mt), or an average 10.31 million barrels per day (b/d), according to a just-released Platts analysis of Chinese government data. The official data also showed China turning into a net exporter of oil products during the January – November period this year.

China's apparent oil demand in November increased 2.2% from October. Meanwhile, total apparent oil demand was 9.99 million b/d during the first 11 months of the year, an increase of 2.3% over the same period last year.

In an unprecedented development, China has become a net exporter of oil products over January to November this year, with oil product exports surpassing imports by 70,000 mt.

Stimulus measures implemented by the Chinese government and a seasonal uptick in year-end demand helped buoy consumption in November.

"Chinese refiners requested for more oil product quotas from the government for the fourth quarter," said Platts senior writer for China, Song Yen Ling. "This was mostly to accommodate additional jet fuel exports because of robust production growth."

Crude throughput by refineries in November was up 5.5% year over year to 42.25 million mt, or an average 10.32 million b/d, according to data released by the National Bureau of Statistics (NBS) mid-December.

MONTHLY TRADE DATA IN MILLION METRIC TONS


Nov '14

Nov '13

% Chg

Oct '14

Sep '14

Aug '14

Jul'14

Net crude imports (million mt)

25.41

23.43

+8.5

24.09

27.58

25.08

23.76

Crude production (million mt)

17.63

17.39

+1.4

17.94

17.16

17.49

17.34

Apparent demand (million mt)

42.18

40.76

+3.5

42.65

42.34

41.19

40.63

Apparent demand ('000 b/d)

10,306

9,959

+3.5

10,085

10,345

9,739

9,607

Sources: China's General Administration of Customs, National Bureau of Statistics, Platts

China's oil product imports tumbled 16% year over year to 2.37 million mt in November, while exports climbed 15.6% to 2.44 million mt, according to data released by the General Administration of Customs. Over January to November, net oil product imports fell 26.1% to 26.78 million mt while oil product outflows rose 3.8% to 26.85 million mt.

Apparent demand for gasoil in November was up 4.4% from a year ago to 14.97 million mt. Gasoil accounts for the largest volume across all oil products. Up to 70% of the fuel is used in the transport sector while the remainder is used by various sectors, including construction, farming and fishing, mainly for industrial heating or to power machinery. Because of China's economic torpor in the last two years, gasoil demand growth has been sluggish although expansion has picked up in recent months on a slight recovery in demand.

Last month's domestic production of gasoil was 15.12 million mt, a 3.9% increase on a year-over-year basis while net outflows of the fuel slumped 28.6% to 150,000 mt – the first year-over-year decrease since March this year. Chinese refiners typically draw down their domestic stockpiles of gasoil throughout the year and start building inventories during the fourth quarter in preparation for the following year's Chinese New Year holidays in January or February.

Apparent demand for gasoline in China continued its upward trend, although growth eased to 9% to 8.74 million mt in November as curbs on traffic around Beijing during the Asia Pacific Economic Cooperation (APEC) summit took effect during the first half of the month.

Domestic gasoline production jumped 10.6% year over year to 9.2 million mt last month, although exports surged 53.3% from a year earlier to 460,000 mt.

Fuel oil apparent demand in November inched up 1% year over year to 2.74 million mt, buoyed by a 4.4% increase in domestic output to 2.29 million mt while net imports fell 13.5% to 450,000 mt.

Over the first 11 months of the year, fuel oil apparent demand slumped 13.8% from a year ago to 30.7 million mt, as domestic production dipped 1.4% to 23.27 million mt, while net imports slid 38.1% to 7.43 million mt.

Lower consumption, particularly by the bunker sector and independent "teapot" refineries, has resulted in lower import volumes this year. To learn more about these small-scale refiners, read the just-published Platts exclusive five-part series looking at China's independent oil refineries.

Month-to-month demand in China is generally viewed to be subjected to short-term anomalies which are of interest and important to note, but often fail to reveal the country's underlying demand trends. Year-to-year comparisons are viewed by the marketplace to be more indicative of the country's energy profile.

*Platts calculates China's apparent or implied oil demand on the basis of crude throughput volumes at the domestic refineries and net oil product imports, as reported by the NBS and Chinese customs. Platts also takes into account undeclared revisions in NBS historical data.

The government releases data on imports, exports, domestic crude production and refinery throughput data, but does not give official data on the country's actual oil consumption figure and oil stockpiles. Official statistics on oil storage are released intermittently.

Platts releases its monthly calculation of China's apparent demand between the 18th and 26th of every month via press release and via its website. Any use of this information must be appropriately attributed to Platts. Platts uses a conversion rate of 7.33 barrels of crude per metric ton, the widely-accepted benchmark for markets East of Suez.

For more information on crude oil, visit the Platts website at www.platts.com. For Chinese-language information on oil and the energy and metals markets, visit http://www.platts.cn/.

About Platts: Founded in 1909, Platts is a leading global provider of energy, petrochemicals, metals and agriculture information and a premier source of benchmark prices for the physical and futures markets. Platts' news, pricing, analytics, commentary and conferences help customers make better-informed trading and business decisions and help the markets operate with greater transparency and efficiency. Customers in more than 150 countries benefit from Platts' coverage of the biofuels, carbon emissions, coal, electricity, oil, natural gas, metals, nuclear power, petrochemical, shipping and sugar markets. A division of McGraw Hill Financial (NYSE: MHFI), Platts is based in London with more than 1000 employees in more than 15 offices worldwide. Additional information is available at www.platts.com.

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SOURCE Platts



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