Platts: China oil demand rises 8.2% YOY

June 30, 2015

Platts’ analysis of Chinese government data shows that China's apparent oil demand in May has increased 8.2% from a year earlier to 43.80 million tonne, or an average 10.36 MMb/d. The growth appeared to be driven by increased demand for various oil products.

Apparent demand during the month was supported by healthy demand growth across all oil product categories.

China’s refinery throughput in May averaged 10.38 MMb/d, rising 7.4% from a year earlier, data from the country’s National Bureau of Statistics (NBS) showed June 15.

On the other hand, China was a net oil product exporter in May, with volumes totaling 120,000-tonne, according to data released 24 June, 2015 by the General Administration of Customs.

During the first five months of this year, China’s total apparent oil demand averaged 10.45 MMb/d, an increase of 5.2% from the same period of 2014. This continues to be the fastest pace of year-to-date growth since 2011 and defies a relatively weak macroeconomic outlook.

“This was the fastest pace of growth since June 2013, when demand grew by 11.53%. Demand for all key products showed year-on-year increase in the month,” said Mriganka Jaipuriyar, Platts associate editorial director for Asia oil news. “Gasoil apparent demand could in reality be lower, as according to Platts estimates, gasoil stocks have risen 7.3% at the end of May from a year earlier.”

Gasoil is the most widely consumed oil product in China and demand has been hit in the last three years because of declining economic growth. Yet apparent demand in May expanded by a robust 7.4% year over year to 15.39 million tonne.

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, industrial heating and to power machinery.

Apparent demand for gasoil was up 4.3% over January to May to 74.21 million tonne.

Demand for LPG in China has rebounded in the last two years following the start of new propane dehydrogenation plants in the petrochemicals sector. These facilities primarily use imported LPG as feedstock.

Apparent demand for LPG in May increased 13.9% year on year to 3.27 million tonne, with net imports jumping 18.7% over the period to 730,000-tonne. So far this year, apparent demand for LPG has gained 21.3% year over year to 15.29 million-tonne.

Meanwhile, apparent demand for gasoline climbed 13.7% year over year to 9.96 million tonne, with year-to-date demand growing 10% to 47.21 million tonne.

According to Platts estimates, May gasoline stocks fell 10.1% at the end of May compared with the same period in 2014, suggesting that actual year-over-year demand growth would be higher than apparent demand.

Data from the NBS showed that sales of gasoline-guzzling SUVs and MPVs rose 43.9% and 7.8% year over year in May respectively, although overall gasoline passenger vehicle sales only edged up 0.7%.

 Apparent demand for fuel oil in May increased 7.4% year over year to 2.72 million-tonne, the first positive growth since November 2013. Net fuel oil imports surged 61.8% during the month to 647,000-tonne. Apparent demand for fuel oil during January to May tumbled 15.8% to 12.93 million tonne.  

The strong growth in fuel oil net imports can be attributed to higher run rates in teapot refineries, which use imported fuel oil as feedstock. In Shandong, home to 80% of China’ teapot refineries, the average run rate was 47% in May, up seven percentage points from May 2014.

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.

MONTHLY TRADE DATA IN MILLION TONNE

 

May’15

May ‘14

% Chg

Apr ‘15

Mar ‘15

Feb ‘15

Jan ‘15

Net crude imports (million tonne)

23.11

26.08

-11.4

29.85

26.06

25.39

27.81

Crude production (million tonne)

18.14

   17.78

+2.0

17.50

18.06

16.18

17.97

Apparent demand (million tonne)

43.80

40.48

+8.2

42.89

44.73

40.70

43.22

Apparent demand (‘000 b/d)

10,357

9,572

+8.2

10,479

10,576

10,655

10,219

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



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