China's crude oil throughput fell in April from a year earlier, official data showed, due to maintenance at state-owned refineries and as independent plants curbed output amid poor margins.

 

The world's second-largest oil consumer processed 58.03 million metric tons of crude in April, or about 14.12 million barrels per day (bpd), according to data from the National Bureau of Statistics.

 

The daily processing rate in April declined by 4.9 per cent compared with March, and was down 1.3 per cent from a year earlier.

 

Outages of the state-owned refineries this year are 100,000 bpd higher than last year, causing a bigger drop in runs in this sector in April and May, according to Rystad Energy.

 

Independent refineries, also known as "teapots", in China's refining hub Shandong faced thinner profit margins during the month.

 

“Teapot runs were hit hard by sanctions yet started to recover slowly from March with workarounds found to continue to take Russian and Iranian crudes. Teapot runs recovery was slow and weak driven by the falling gasoline and diesel demand pressured by EV penetration and persistently dismal housing sector,” said Ye Lin, a Beijing-based analyst with Rystad Energy.

 

Overall, Chinese refineries operated at 73.83 per cent capacity in April, the lowest since 2022, down 1.7 percentage points from March and down 5.35 percentage points from a year earlier, according to Chinese consultancy Sublime China.

 

The theoretical average profit for Shandong teapots was 270 yuan ($37.5) per metric ton, down 58 yuan per ton from March due to declining gasoline and diesel prices, the consultancy said.

 

Weakened fuel demand weighed on margins.

 

Apparent domestic gasoline consumption fell 4 per cent year-on-year during the first quarter and diesel dropped 6.1 per cent, according to another consultancy JLC.

 

Still, for the first four months of the year, refiners processed 0.8 per cent more crude than in the year-earlier period - a total of 240.27 million tons, or 14.62 million bpd.

 

Two independent refineries recently sanctioned by the US faced supply disruptions such as having difficulties in receiving cargoes at ports and securing financing, Reuters has reported.

 

Worries about sanctions have also led to about five plants in Shandong halting purchases of Iranian crude since last month.

 

NBS data showed that China's domestic crude oil production in April rose 1.5 per cent year on year to 17.72 million tons, or 4.31 million bpd.

 

Year-to-date crude output rose 1.2 per cent at 71.81 million tons, or 4.37 million bpd.

 

Natural gas output increased 8.1 per cent from a year earlier to 21.5 billion cubic meters, and production for the first four months grew 5.3 per cent, the data showed. -Reuters