Platts: China's Oil Demand in June Hits New High

China's apparent oil demand in June hits yet another record high, at 36.74 million metric tons (mt) or about 8.98 million barrels per day (b/d), according to the just released Platts analysis of official data from the People's Republic of China. The June demand figure is up 10% from a year ago and it eclipses the previous high of 36.48 million mt established in May 2010 by 0.7%.

China's net oil product imports this June rebounded from recent lows, even as Chinese refiners maintained high crude throughput in their plants, the analysis shows.

Meanwhile, China's apparent oil demand in the first half of 2010 jumped 13% to 210.81 million mt from the corresponding period of 2009, Platts reports. The January-June average was 8.54 million b/d.

Chinese refiners in June processed a total 35.35 million mt of crude oil, or an average 8.64 million b/d, according to data recently released by China’s National Bureau of Statistics. Thus, crude throughput is up 11% from a year ago, but is down 1.2% from the historic high of 35.79 million mt in May 2010.

"The recent gradual appreciation of the renminbi versus the U.S. dollar makes Chinese imports of refined products relatively cheaper and exports relatively less attractive," said Vandana Hari, Platts' Asia editorial director. "But it remains to be seen whether the June climb in net oil product imports represents the start of a trend."

"Chinese oil demand growth is being led by sizable increases in production and consumption of naphtha – a feedstock for petrochemicals – and of jet fuel/kerosene and gasoil," Hari said.

"The rise in gasoline consumption is trailing well behind these products, a somewhat puzzling phenomenon in the face of runaway growth in the country's car sales," she noted.

"This seeming anomaly, and the continued lack of reliable official data on demand and oil stocks from China, is once again prompting some unease, with the International Energy Agency earlier this month suggesting that either implied Chinese oil demand data for previous years is inaccurate, or the country's gross domestic product numbers inflated," Hari explained.

China's net refined oil product imports rebounded to 1.39 million mt in June from 0.69 million mt in May. But compared to a year ago, net refined oil product imports were down 2.8%.

For the January-June 2010 period, Chinese imports of refined products totaled 19.86 million mt, down nearly 10% from a year ago. Meanwhile, product exports were 14.77 million mt for the January-June 2010 period, marking a 35% increase from the year-ago period. China's crude imports in the first semester of 2010 were up 30% from a year ago to 117.96 million mt.