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China 2023 oil refinery output forecast to rise 8% on demand recovery

China’s crude oil refinery throughput this year is forecast to rise 7.8%, according to a think tank of state energy group CNPC, reversing last year’s decline the world’s second-largest oil consumer is set for a recovery in fuel demand.

Refinery throughput is estimated to reach 733 million tonnes, or 14.66 million barrels per day (bpd), for 2023, China National Petroleum Corporation’s (CNPC) Economics and Technology Research Institute (ETRI) said in its annual industry outlook released on Monday.

With Beijing determined to revive its sagging economy after lifting COVID-19 controls last December, Chinese refined fuel consumption is expected to rebound with top refiner Sinopec earlier on Monday separately predicting a 3.3% increase in its annual throughput this year.

“(We are) expecting refined fuel consumption to rebound progressively in 2023…with gasoline set for strong recovery, diesel fuel to hold steady and improving further while jet kerosene is bottoming out,” ETRI said.

That will likely lead to 6.2% growth in this year’s crude oil imports to 540 million tonnes, or 10.8 million bpd, the research unit said.

The growth is in line with forecasts by independent analysts predicting China’s oil imports will rise to new highs this year as a result of the COVID policy change and new refineries coming on stream.

CNPC also predicted that the country’s refineries will operate at an average of 79.4% of their capacity in 2023, up from 73.6% last year. China has become the world’s largest refiner following a recent petrochemicals-led expansion.

Natural gas consumption is seen rising 5.2% this year to 386.5 billion cubic meters, CNPC said. China’s state economic planner reported that gas consumption fell by 1.7% last year in its first decline in two decades as pandemic measures and high global prices suppressed economic activities.
Source: Reuters (Reporting by Andrew Hayley. Writing by Dominique Patton and Chen Aizhu; Editing by Louise Heavens and Christian Schmollinger)

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