• 7 days Retail On Pace For Most Bankruptcies And Store Closures Ever In One Year: BDO
  • 10 minutes America Could Go Fully Electric Right Now
  • 9 days Majors Oil COs diversify into Renewables ? What synergies forget have with Solar Panels and Wind Tirbines ? None !
  • 1 hour Most ridiculous green proposal
  • 15 hours The Green Hydrogen Problem That No One Is Talking About
  • 7 hours Biden's laptop
  • 1 hour QUESTION: With worldwide 1.4 Billion passenger vehicles and 360 Million commercial vehicles using combustion engines how long before gasoline and distillates measurably decline. .
  • 2 hours Rethinking election outcomes for oil.
  • 3 hours The City of Sturgis Update on the Motorcycle Rally held there, and the MSM's reporting hence
  • 1 day China Sets Its Sights On Global [EV, AI, CRISPR, Fusion, Navel Lint Collector] Dominance
  • 4 hours Video Evidence that the CCP controls Joe Biden
  • 8 hours DOJ confirms FBI investigating Hunter Biden since last year for money laundering.
  • 16 hours Making diamonds from thin air
  • 10 hours P@A will cost Texas Taxpayers $117 Billion.
Oil Prices Rebound On Small Crude Draw

Oil Prices Rebound On Small Crude Draw

Oil prices rebounded today after…

Philippines Is Getting Ready To Drill For Oil And Gas

Philippines Is Getting Ready To Drill For Oil And Gas

The President of the Philippines…

Trump Blasts Biden's Fracking Plans At Rally

Trump Blasts Biden's Fracking Plans At Rally

President Donald Trump told supporters…

Irina Slav

Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

More Info

Premium Content

No Financing And No Demand: Chinese Refiners Run Into Trouble

International banks are suspending credit lines for some independent oil refiners worried about the growing risk of defaults across industries because of the coronavirus epidemic, Reuters reports, citing industry sources.

According to the sources, at least three private refiners, or teapots, have had credit lines to the tune of $600 million suspended by banks including French Natixis, Dutch ING, and Singapore DBS Group Holdings.

“All our applications for new open-account credits are frozen ... these clean credits are pivotal as we buy 6 to 8 million barrels of oil each month,” one source told Reuters.

Refiners, both private and state, have already reduced their run rates in response to the slump in fuel demand resulting from the outbreak, and now they have deepened these cuts, Bloomberg reported last week.

The average as of last Thursday was about 10 million bpd, down by 25 percent on the same time last year, when the average run rates were at a record high of close to 13 million bpd. Analysts expect the low run rates to continue at least until the end of this month, but if it spills into March, some refiners—notably independent refiners—will start experiencing a lack of storage space, too, after earlier this month they took advantage of low prices to stock up on crude.

Now, on top of that, the teapots that have accounted for a large portion of China’s increased thirst for oil that was instrumental in oil price recovery after the crisis, are having financing trouble.

“We were told by our banks that so long as the open-account credits are for oil heading to Shandong, it will be very hard chance winning approvals,” another Reuters source said.

The three refiners refused credit line extensions have combined oil import quotas of about 240,000 bpd, Reuters reports. If more banks become wary of defaults among refiners, this could hit imports over a longer term.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News