China processed record amounts of crude oil in 2021 to meet rising domestic consumption of petroleum products. In 2H21, China processed slightly less crude oil and began exporting significantly less gasoline and diesel than in 1H21 to ensure sufficient domestic supply.
According to China’s National Bureau of Statistics, the country processed a record 14 million bpd of crude oil in 2021, a 4.6% increase from 2020. Crude oil processing in China was particularly high in 1H21, in response to high demand both domestically and elsewhere in Asia. Despite more refinery capacity, crude oil processing decreased by 0.4 million bpd in 2H21 compared with 1H21.
Beginning in August 2021, several COVID-19 outbreaks in China led to mobility restrictions, which in turn reduced domestic demand for petroleum products. Mobility restrictions during the Winter Olympics and COVID-19 travel restrictions that began in March 2022 in several parts of China continued to reduce demand for petroleum products in China at the beginning of 2022. China’s crude oil processing has also declined because relatively high crude oil prices are making importing crude oil more expensive.
In addition to this, China’s refiners met their petroleum product export quotas in 2021. They were not granted a second batch of export quotas until August, and those quotas were relatively low. These quotas set the maximum amounts of each product that refiners can export and are disseminated on a rolling basis.
China’s exports of diesel and gasoline ended 2021 at lower levels than at the beginning of the year. Low petroleum product exports have continued into 2022 because China’s first batch of export quotas in 2022 were 56% lower than its first batch in 2021. Because of these quotas, in February 2022, China exported the lowest amount of diesel since early 2015.
Read the article online at: https://www.hydrocarbonengineering.com/refining/28042022/eia-china-processed-record-amounts-of-crude-oil-in-2021-but-exported-less-gasoline-and-diesel/
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