China refiners cut April crude runs at scale not seen since pandemic's early days

Chinese refiners are set to cut crude throughput this month by about 6%, a scale last seen in the early days of the COVID-19 pandemic two years ago, to ease bulging inventories as recent COVID lockdowns undercut fuel consumption, industry sources and analysts said. Refiners are expected to lower crude oil processing in April by 3.7m tonnes, or 900,000 barrels per day (bpd), equivalent to 6.3% of average national throughput in the latest annual figures, according to estimates by six industry sources and analysts. Slowing demand at the world’s top crude importer would help to cool global oil prices, which remain above $100 after touching 14-year peaks last month, buoyed in part by supply disruption fears following Russia’s invasion of Ukraine. The slump in demand has also forced state refiners to export more fuel from their swelling inventories, countering government-led efforts to scale back overseas shipments after the Russia-Ukraine conflict stirred worries about supplies. Companies are forecast to export approximately 2m tonnes of gasoline, jet fuel and diesel combined this month, sources said, which could also allow Chinese refiners to reap the benefits of record Asian refining margins. Customs data released on Wednesday showed that China’s crude oil imports fell 14% in March from a year earlier. Imports had been pressured by deteriorating margins at small, independent refiners and by seasonal maintenance, and with the added impact of sliding demand, further declines are expected in April. China’s throughput data for March will be released next Monday. Chinese fuel demand took a sharp downturn in March when worsening coronavirus outbreaks were met by widespread lockdowns, including three weeks of mobility restrictions in Shanghai, China’s largest city, to contain the highly contagious Omicron variant.<br/>