• 16 hours Watch for biofuels policy changes ...
  • 11 hours EPA's Pruitt cites Bible to justify administration policies
  • 21 hours Syria's Ghouta - Is there Threat Of Genocide? The World Is Silent.
  • 18 hours Norway - World's Most Democratic Country! Where is the U.S. on the list?
  • 21 hours Majority unlikely to use self-driving cars
  • 22 hours Saudi Arabia's Building a $500 billion Mega-City and Will Run 100% on Renewable
  • 2 days Elon Musk Steps Down From OpenAI Board to Dodge “Potential Future Conflict”
  • 17 hours US shale production dull until someone starts talking shareholder payback
  • 1 hour Perovskite Co.'s will they live to the promise?
  • 16 hours First Oklahoma, Now Kansas Fracking Tied to Earthquakes
  • 2 days US admin to kill Energy Star program
  • 6 hours Ideas on demand
  • 22 hours VW Looks At Apple For Electric-Car Design Guidance
  • 20 hours HAPPY RIG COUNT DAY!!
  • 23 hours DNA Robots Target Cancer
  • 19 hours Plastic bans to dent oil demand growth-BP
Oil Prices Rise As Bullish Sentiment Returns

Oil Prices Rise As Bullish Sentiment Returns

Bullish sentiment appears to be…

BP Sees Peak Oil Demand In 2030s

BP Sees Peak Oil Demand In 2030s

BP is predicting that EVs…

China Unlikely To Maintain Record Oil Product Exports

Tanker

China exported a record volume of refined oil products in December, but the oil price rally has been driving refining margins down in recent weeks. These falling margins mean January’s oil product exports may be lower as its production falls, Reuters columnist Clyde Russell writes.

China’s commodity trade data for December showed that the country exported 6.17 million tons of refined oil products, equal to about 1.6 million bpd using the BP conversion factor of 8 barrels of product/ton.

Chinese fuel exports in December increased by 6.6 percent compared to November.

The record December fuel exports—including gasoline, diesel, and jet fuel—were the result of near-record imports of crude oil in November and strong refining margins, according to Russell.

In November, China had imported crude oil at a rate of 9.01 million bpd—the second-highest on record.

But since then, the oil price rally has weakened refining margins, and with the inverse relationship between oil prices and refining margins, refiners’ production could drop.

In China’s case, it will be crucial to see if independent refiners—the so-called teapots—can compete with the bigger state-held refiners for more efficient crude oil processing, in order to stay competitive amid the decline in refining margins.

At the end of 2017, China announced the first batch of crude oil import quotas to independent refiners for 2018, with allocations close to the refiners’ annual ceilings, to allow them to better plan their crude purchases for the year.

Related: Cold Snap Leads To Biggest U.S. Natural Gas Draw Ever

“The high allocation in the first round will enable refineries to plan their imports more efficiently in 2018, instead of worrying about the quota shortage all the time,” an independent refinery source told S&P Global Platts at the end of December.

After an 8-percent monthly increase in teapots’ crude oil imports in December, imports in January are also expected to increase month-on-month, due to the high allocations in the first batch, Platts’ Daisy Xu wrote in an analysis last week. The January imports may not rise much, however, due to weakened refining margins and the deep backwardation of the market structure that makes taking delivery earlier than needed uneconomical for refiners.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

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