FocusChina’s fuel consumption seen overrunning production

27 January 2012 04:52  [Source: ICIS news]

Chevrolet Sail cars in Shandong, China. The countryBy LiLi

SINGAPORE (ICIS)--China’s petroleum consumption will increase by 5-5.5% to 493m tonnes, while crude throughput may rise by 4% to 464m tonnes leading to a surge of imports of oil products by 31% to 29m tonnes in 2012, industry analysts said on Friday.

There will be fewer new refining capacities in 2012, according to C1, an ICIS service in China. As a result, China’s petroleum market may continue to see tight supply in 2012.

However, this may change when China’s refining capacity enters peak growth in 2013-2014.

Based on C1 statistics, China’s crude refining volume will expand by 4-5% in 2012 and 6-9% in 2013-2016.

As China’s refining capacity continues to expand over the next five years, its crude throughput will rise accordingly, reaching 622m tonnes by 2016, reflecting an annualised increase of 6-7%.

Its net imports of crude oil will top 400m tonnes by 2016, which is 70% more than that in 2010. By 2016, its dependence on crude imports will be 62-63% from 54% currently.

Over the next five years, economic development, industrialisation, urbanisation and expanding domestic demand will continue to drive China’s petroleum consumption, according to C1 estimates.

Among the major oil products, the country’s demand for jet fuel is expected to rise at a relatively high speed of 8-9% per year up to 2015.

“Jet fuel demand may be the leading growth in the fuels market, supported by robust aviation turnover growth, while gasoline and gasoil demand may slow down because of poor car sales and lower industrial gasoil consumption,” said an analyst at Sinopec Economics and Technology Institution.

Gasoil and gasoline demand is expected to grow by 5-7% and 4-6%, respectively each year, while naphtha demand will likely surge with more cracker and PX facilities coming online in 2013-2014, according to C1 estimates.

In addition, China’s fuel oil demand may rise sharply in 2012, when many independent refineries start up new capacities.

However, the country’s demand growth of fuel oil is expected to decline gradually thereafter.

“If major refineries still face shortage of spare refining capacity in 2012, independent refiners may likely to see opportunity on gasoil and gasoline shortage for the second year,” said a Shandong-based independent refinery source, referring to a similar shortage in the fourth quarter of 2011.

In 2012, the country may still restrict its exports of gasoline and gasoil to guarantee domestic supply.

Jet fuel may see balanced supply and demand, while bitumen importing may still be weak on tight bank loans.

Table: Forecast of China's Petroleum Consumption (2011-2012)

Unit: million tonnes

 

2012E

2011E

2012/2011

 

Petroleum Consumption

493

468

5%

 

Crude Throughput

464

446

4%

 

Crude Net Imports

276

255

8%

 

Products Net Imports

28.1

22.1

31%

 

LPG

2.30

1.91

20%

 

Naphtha

1.87

1.71

10%

 

Gasoline

-3.27

-3.82

14%

 

Gasoil

2.39

0.35

583%

 

Kerosene

0.10

-0.55

118%

 

Fuel Oil

19.1

16.3

17%

 

Base oil/Lubricant

 

 

 

 

Bitumen

2.94

3.27

-10%

 

Petroleum Coke

3.35

2.87

16.72%

 

Source: C1 Energy, NBS

 

 

 

Note: Petroleum coke net imports to be included since 2009

 

 

 

For more information on naphtha, visit ICIS chemical intelligence
Please visit the complete ICIS plants and projects database
Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections


By: Li Li



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