The assumption of modest inventory builds as part of the commissioning of new refining units is a safe choice, but it's worth noting that China's refiners and the authorities in Beijing tend to use stockpiles to smooth out prices, even if they don't talk about this in public. Two new refineries - PetroChina's Guangdong Petrochemical and Jiangsu Shenghong Petrochemical with a combined capacity of 520,000 bpd - are expected to enter commercial operation in the coming months, industry sources said last month.Ī third new plant, Shandong Yulong Petrochemical's 400,000 bpd project, may also begin crude imports for possible test runs by the end of the year, a company source told Reuters.įlows in, or indeed out of, either commercial or strategic reserves are the biggest X-factor for China's crude oil imports. It's likely that some of the oil heading for storage will go to build working inventories for new plants expected to be commissioned this year.
China doesn't disclose the volumes of crude flowing into or out of strategic and commercial stockpiles, but an estimate can be made by deducting the amount of crude processed from the total of crude available from imports and domestic output.
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