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China’s fuel demand is set to jump by 10% this quarter compared to the same period of 2022 thanks to the latest economic stimulus policies, Huang Yongzhang, the president of state energy giant PetroChina, has said.
“In the fourth quarter, China's economic stimulus policy is going to yield more results, domestic consumptions are set to rebound further...and demand for industrial products is going to improve,” Huang told investors in an online roadshow, as carried by Reuters.
PetroChina, the second largest refiner in the country after Sinopec, reported earlier this week record year-on-year net profit growth of 21%, with third-quarter earnings reaching $6.3 billion on increased output and rising domestic fuel demand.
The company saw a 4.3% year-on-year increase in crude oil output during the first nine months of this year and a 6.1% increase in natural gas output.
While PetroChina realized lower oil and gas prices during the first nine months of this year, higher domestic fuel demand allowed it to increase production and boost net profit.
Total fuel sales increased 13.4% year-on-year, with domestic sales up 17% as the company–the largest oil and gas producer in Asia–took timely advantage of China’s macroeconomic recovery.
The 10% increase that PetroChina expects in the country’s fuel demand this quarter will come from a low level of comparison with the October-December quarter of 2022 when China was still under strict Covid lockdowns limiting mobility and travel and weighing on the economy.
China has seen strengthening domestic fuel growth in recent months despite the weak early start to the re-opening.
But on Tuesday, fears of slowing fuel demand in China re-emerged after data showed that factory activity unexpectedly contracted in October. The purchasing managers’ index (PMI) fell into contraction territory in October, to 49.5 from 50.2 in September, per data from the National Bureau of Statistics.
By Charles Kennedy for Oilprice.com
Charles is a writer for Oilprice.com