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China data: Apr crude stocks rise 38 mil barrels from end-Mar

Singapore (Platts)--16 May 2018 543 am EDT/943 GMT


China saw a build of 37.84 million barrels in crude oil stocks over April, from end-March, which was 65.3% higher than the previous month due to heavy crude imports and lower throughput, S&P Global Platts' calculations based on latest official data showed Wednesday.

Crude stocks are likely to continue to rise in May as imports are likely to remain strong.

China does not release official data on stock. Platts calculates the country's net build or draw on crude stocks by subtracting the official refinery throughput data from the country's crude supply data. The latter takes into account net crude imports and domestic production.

The General Administration of Customs data showed that crude imports hit a record high of 9.64 million b/d in April, jumping 14.7% from a year ago, and rising 4.1% month on month.

Last month, the heavy inflow pushed the country's crude supply up by 5.4% from March to 13.38 million b/d.

The country's refinery throughput in April, however, edged down 0.5% month on month to 12.11 million b/d, the National Bureau of Statistics' data showed.

The decline was driven mainly by scheduled maintenance at PetroChina's Sichuan refinery, Sinopec's Gaoqiao and Zhenhai refinery last month, while independent refiners had cut their average run by about one percentage point.

With the decline in refinery throughput and the strong growth in supply, the stockbuild of 37.84 million barrels in April was more than the 22.88 million barrels of crude that ended up in storage in March.

However, on a year on year basis, the 11.5% increase in crude throughput last month, was 5.1% lower compared with April 2017.

Generally, crude throughput in 2018 registered a higher year on year growth than crude oil imports, resulting in a slimmer stock build over the first four months than during the same period last year.

During January-April, China's crude oil stock stood at 98 million barrels, compared with 132 million barrels recorded during the same period in 2017.

STOCK CONTINUES TO RISE IN MAY

Looking ahead, China's crude oil stocks are expected to continue to rise in May, as its crude oil inflow remained strong despite an expected month on month increase in refinery throughput rate.

S&P Global Platts trade flow tracker cFlow showed Wednesday that May seaborne arrivals in China was almost flat, compared with April, at 8.71 million b/d. The world's biggest crude importer receives oil by both pipelines and tankers.

Analysts said Chinese buyers were trying to increase imports in an effort to lock in their costs, prior to further gains in oil prices.

International crude benchmarks almost hit the $80/b mark on Tuesday on the back of geopolitical risk and OPEC's forecast of higher global demand.

ICE July Brent crude futures were traded at $79.14/b at 1100 GMT Tuesday.

Meanwhile, May throughput is likely to be slightly higher than in April due to fewer maintenance. Strong demand for gasoil may also encourage an increase in refining runs.

The average price of gasoil in China gained about Yuan 350/mt ($6.32/b) so far in May from April, Chinese information provider JLC's data showed.

The rising gasoil price has encouraged independent refiners to lift throughput slightly to 62.9% in May, from 62.4% in April, the data showed.

-- Oceana Zhou, oceana.zhou@spglobal.com

-- Edited by Norazlina Jumaat, norazlina.jumaat@spglobal.com




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