BAKU, Azerbaijan, February 22. China's refinery throughputs in 2024 are expected to grow by around 340,000 b/d, Trend reports.
Thus, the International Energy Agency (IEA) has kept its forecast for the country's crude runs largely unchanged.
At the same time, the existing downturn in domestic margins has put a damper on activity levels in the independent refining sector, despite the issuance of new import and export quotas. Consequently, the IEA has adjusted its seasonal profile, reducing 1Q24 and 4Q24 run rates by an average of 270,000 b/d and elevating 2Q24 and 3Q24 by approximately 240,000 b/d.
However, with Chinese demand for refined products expected to increase by 520,000 b/d year-on-year in 2024, and indications of lighter planned maintenance compared to the previous year, it appears that runs will likely see an upturn, notwithstanding limited capacity additions, the agency pointed out, adding that the commencement of the 400,000 b/d Yulong refinery later this year may contribute to these gains, although capacity closures in other areas of Shandong are also probable.
Moreover, the recent subdued performance in Chinese runs reflects the growing share of LPG/ethane and naphtha in the country's demand mix, much of which is fulfilled through imports rather than domestic output. The growth in crude runs during 4Q23 slowed to a mere 475,000 b/d, while total demand growth exhibited more resilience at 1.4 mb/d year-on-year. Balancing these factors, Chinese refined product demand growth declined to 1.1 mb/d year-on-year, while net product exports experienced a substantial drop of almost 800,000 b/d year-on-year, reaching 650,000 b/d. The projected increase in runs by 340,000 b/d this year suggests that clean product exports are likely to be lower than the average of 750,000 b/d recorded last year.