China's July crude oil throughput fell 15.8% from a year earlier but edged up from June, marking the first month-on-month rise since the Iran war began in late February, data from the National Bureau of Statistics showed on Monday.
China, the world's biggest energy importer, has cut crude processing and imports since the conflict disrupted supplies and weakened domestic demand, freeing up more oil for other importers.
China processed 53.11 million metric tons of oil in July, or 12.5 million barrels per day, official data showed. Daily throughput remained far below pre-war levels but increased 0.3% from June, when it hit its lowest level in more than six years.
Despite the sharp drop in refinery runs, China continued to draw on oil stockpiles in July, according to several consultancies.
Kpler estimated a drawdown of 25 million barrels, while Vortexa put it at 28 million barrels, which would be the biggest since September 2021.
Those estimates, based on satellite images of above-ground storage tanks, suggest China's refinery output was higher than official figures indicate, according to Vortexa analyst Emma Li.
The consultancy estimates a steep draw in onshore crude inventories, instead of the 0.2 million barrel increase implied by comparing imports and production to refinery output, which may be because China's statistical bureau excludes smaller refineries from its calculations. China does not publish information about its reserves, which it treats as a state secret.
China's oil stockpiles would last for years at the drawdown rates estimated by the consultancies. Still, the need to tap reserves underscores how sharply China has cut oil imports, which, despite rebounding last month, remain down 24% year-on-year.
The drawdown appears to be accelerating this month. Kpler estimates a further 26 million barrels have been withdrawn as of August 17 and expects stock draws to accelerate through October.
Monday's data showed oil throughput in the first seven months of the year fell 6.5% from a year earlier to 396.96 million tons, or 13.67 million bpd.
Domestic crude production rose 0.8% in July year-on-year to 18.27 million tons, or 4.3 million bpd. Output in the first seven months reached 127.69 million tons, up 0.9%.
Natural gas production fell 0.9% in July from a year earlier to 21.4 billion cubic meters.
Gas output in the first seven months rose 1.2% to 154.3 bcm.
(1 metric ton = 7.3 barrels for crude oil conversion)
