China's crude throughput drops for the seventh straight month – JLC

China’s October crude throughput declined for the seventh consecutive month on a year-on-year basis due to weak domestic demand, market intelligence provider JLC reported.

PHOTO: Oil pumpjacks, with the Chinese flag in the background. Getty Images

Chinese refiners processed about 59.54 million mt of crude oil in October, marking a decline of 5% from the previous month, JLC reported citing data from the National Bureau of Statistics (NBS).

Daily throughput in October stood at around 14.02 million bbls, according to NBS data.

“Domestic diesel demand plunged on a year-on-year comparison in October, despite a modest month-on-month increase, which continued to dampen Chinese refineries’ crude throughput,” JLC reported.

Besides, bad refining margins also dented production levels, it said. On a year-on-year comparison, crude oil throughput in October was down by 5% from the corresponding month in 2023, JLC reported.

According to market analysts, this news has exerted downward pressure on oil prices, with the global oil market already becoming more cautious of weak economic growth in China. “Ongoing concerns about China demand… put a damper on the [oil] market,” Price Futures Group’s senior market analyst Phil Flynn said.

The country processed about 590.59 million mt of crude (14.14 million b/d) in the first 10 months of this year, down 2% from the same period in 2023, data from the NBS showed. Crude production in China totalled 17.77 million mt in October, an increase of 2.5% year-on-year, JLC reported.

“Fresh data revealed a jaw-dropping 5.4% plunge in apparent oil consumption for October,” SPI Asset Management’s managing partner Stephen Innes said. “Even with China’s fragile economy propped up by stimulus, the rapid shift to electric vehicles is taking a severe bite out of oil demand, leaving the market scrambling for footing,” he added.

By Aparupa Mazumder

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