• 1 day This Will Be the Answer From China On U.S. Tariffs
  • 22 hours Bad News For The Climate: Coal Burning, And Carbon Emissions, Are On The Rise Again
  • 11 hours China's Yaun/Gold backed Futures contracts
  • 1 day France Terrorist Attack?! At Least One Dead In French Supermarket Hostage-Taking
  • 2 days Twitcoin....
  • 2 days Snowden Reveals Bitcoin Transactions Being Tracked by NSA
  • 1 day U.S. Charges, Sanctions Iranians For Global Cyber Attacks on behalf of Tehran. What about sanctions on Russia?
  • 22 hours Canada Bent On Ruining Its Oil Industry
  • 3 days Elon Musk’s $2.6 Billion Tesla Challenge
  • 1 day The Facebook/Cambridge Analytica Scandal
  • 1 day Surprise! Aramco Scraps International Listing Plans
  • 22 hours Country With Biggest Oil Reserves Biggest Threat to World Economy
  • 3 days Getting out of oil .. now
  • 2 days EU Proposes Online Turnover Tax For Big Tech Firms
  • 3 days U.S. Judge To Question Big Oil On Climate Change
Did Venezuela Just Lose A Key Ally?

Did Venezuela Just Lose A Key Ally?

Venezuela is running out of…

Legal Risks Jeopardize World's Largest IPO

Legal Risks Jeopardize World's Largest IPO

Saudi Arabia is putting its…

China Teapot Refiners Overflow, Slow Crude Oil Imports

Teapot Refinery

Chinese independent refiners, the so-called ‘teapots’, are expected to import less crude at least until August, as high inventories, changing import quota policies, and stricter tax scrutiny are squeezing their refining margins—a move that could raise concerns over China’s oil demand growth.

Some independent refiners are pausing for maintenance, while others are cutting run rates because of squeezed margins, Reuters reported on Friday, citing managers at teapots.

There will be more shutdowns in June, July and possibly August. It’s seasonal but also because the market is not doing well and stocks are plentiful,” a manager at a Dongying-based independent refiner told Reuters.

Following record high import volumes in March, China’s total imports in April retreated from previous month highs amid seasonal maintenance.

Since independent refiners were allowed in late 2015 to import crude oil, they had enjoyed plenty of profits and competed with the giant state-run refiners.

But earlier this year, China banned exports of fuel by the independent refiners. The teapots have lobbied with the government to lift that fuel export ban, which had cut a major source of income.

China also said it would stop accepting applications by refiners to import crude oil beginning May 5. It also began stricter checks on the teapots’ tax practices.

Related: Falling OPEC Exports Create Upside For Oil Prices

Some of the independent refiners had hastened to buy crude oil in the first quarter this year for fear of penalties for slow use of their import permits, another teapot manager told Reuters.

There were some over-purchases of crude earlier as [plants] were unsure of the quota policy. Now inventories are high everywhere,” he noted.

In the province of Shandong, where many independent refiners are based, crude stocks at major ports were at a 13-month high because of maintenance at independent refineries and high import volumes in the previous months, S&P Global Platts reported last week, quoting port sources.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:

Join the discussion | Back to homepage

Leave a comment
  • Jhm on May 28 2017 said:
    So China says to OPEC, "Nice little production cut you've got here. It would be a pitty if anything were to happen to demand in Asia."
  • Naomi on May 26 2017 said:
    Mom and Pop oil refineries. Only in China. Eighty octane probably burns in a moped.

Leave a comment

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