China's oil refinery throughput in 2024 fell for the first time in more than two decades barring the pandemic-hit year of 2022, government data showed on Friday, as plants tempered operations in response to stagnant fuel demand and depressed margins.
The world's second-largest refining industry after that of the U.S. processed 1.6% less crude oil last year at 708.43 million metric tons, the National Bureau of Statistics said.
The figure amounts to about 14.13 million barrels per day, Reuters calculations showed, slipping from the record 14.7 million bpd set in 2023.
Refiners came under pressure last year to cap or cut processing rates as the proliferation of electric vehicles eroded gasoline demand while a prolonged property crisis and tepid merchandise exports dampened use of diesel fuel.
"Transport fuels demand barely grew and lower margins have seen gasoline and diesel exports losing steam in 2024, which has affected refinery runs," said analyst Mia Geng at consultancy FGE.
Throughput has seen year-on-year declines from April through October, with independent plants in the eastern refining hub of Shandong run at 54% of processing capacity last year, showed estimates from a Chinese consultancy.
That rate is among the lowest since 2016 when such plants became importers of crude oil for the first time.
Many of these plants operated in the red last year and some had to shut down for months to stem loss, even though they processed primarily discounted oil from Iran and Russia, analysts and refinery managers said.
Permanent plant closure at PetroChina Dalian and indefinite shutdowns at three refineries run by state group Sinochem also contributed to the lower throughput.
That more than offset throughput from Shandong Yulong Petrochemical which started operations with a 200,000-bpd crude unit in late September.
Though Friday's data showed an annual throughput decline of 1.6% in 2024 from 2023, Reuters calculations based on official 2023 figures showed a decline of 3.6%, indicating the statistics agency has revised the year-earlier amount.
For December alone, the data showed throughput edged up 0.6% from the same month a year earlier to 59.35 million tons, or 13.98 million bpd.
China pumped 1.8% more crude oil domestically in 2024 versus a year prior at 212.82 million tons, or 4.24 million bpd. That was just short of an all-time high of 4.3 million bpd in 2015.
The December amount was 17.9 million tons, up 1.4% from a year earlier.
The data also showed natural gas production expanded 6.2% last year to a record 246.4 billion cubic metres, as state oil firms boosted output at top onshore basin Sichuan and offshore reservoirs in the South China Sea.
(metric ton = 7.3 barrels for crude oil conversion)
