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Time of India
15-07-2025
- Business
- Time of India
China state refiners ramp up output on rising demand, stock rebuild
Chinese state-owned refiners are ramping up output after completing maintenance to meet higher third-quarter fuel demand and to rebuild diesel and gasoline stocks which are at multi-year lows, traders and analysts said. The increase in crude processing rates , expected to last through the third quarter, will drive up imports by the world's largest oil importer, although slowing gasoline and diesel consumption is expected to keep a lid on overall demand. Operating rates at state refineries surpassed 80 per cent in the last week of June, up from about 73 per cent a month earlier, the highest for the period in five years, data from consultancy Oilchem showed, as several Sinopec refineries returned to operation from maintenance in the second quarter. China's overall refining throughput was 15.15 million barrels per day in June, the highest since September 2023, according to Reuters calculations based on official data released on Tuesday. The sharp ramp-up in state refinery operations was driven by low product stocks after two months of heavy maintenance in April and May that supported product profit margins, said Ye Lin, a vice president at Rystad Energy. "Demand for jet fuel and petrochemical feedstocks is growing healthily in China, driving more supply from the state-owned refineries ," she added. Refined products output from state refiners Sinopec, PetroChina , CNOOC and Sinochem will exceed 10 million bpd in July, 100,000-110,000 bpd higher than June, according to consultancies FGE and JLC. FGE expects their output to hit 10.4 million bpd in July and August. JPMorgan analysts forecast China's refinery runs to increase year-on-year for the third and fourth quarters, following consecutive annual declines in the previous five quarters. Rising state refinery output pushed up diesel and gasoline stocks in the first two weeks of July, but at 14 million and 11 million metric tons, respectively, inventories are at six-year lows, Oilchem data showed. Official data showed China's January-May diesel and gasoline production fell 7 per cent annually. That is partly because independent refineries, known as teapots, have been operating at just 40 per cent to 50 per cent of their capacity this year due to poor margins, and as U.S. sanctions made it harder for some to buy cheap Iranian oil, industry sources said. Demand China's oil demand will rise seasonally into September but will be restrained by the country's prolonged property sector downturn, trade tariffs and rising sales of electric cars and trucks, the sources and analysts said. Barclays estimates that China's oil demand grew about 330,000 bpd year-on-year in the first half this year, while full-year growth will ease to 150,000 bpd. For July, China's gasoline consumption has firmed due to the summer travel season, but diesel demand remains weak as extreme weather, such as heatwaves and floods, has delayed construction projects in some regions, sources and analysts said. Rystad's Ye expects teapots to increase runs in August to meet higher fuel demand in September. Diesel and gasoline make up more than 40 per cent of China's oil demand.
The Sun
11-07-2025
- Automotive
- The Sun
Surging electric truck sales hit diesel use in China
LANGFANG: Electric-powered heavy trucks are rapidly gaining market share in China, driven by subsidies and the quick rollout of chargers, further curbing diesel usage and denting oil demand from the world's biggest crude importer. The boom in electric truck sales in China follows that of electric cars and the rise in recent years of LNG-powered heavy trucks. Those factors, combined with slowing economic growth, have stifled its oil consumption growth. Sales in the world's biggest market for new energy trucks are estimated to have risen 175% year-on-year to 76,100 in the first half of this year, or about a quarter of new truck sales, according to consulting firm Sublime China Information (SCI). Electric models, still mostly used for short-haul runs in ports, mines or steel mills, accounted for over 90% of that increase. The rapid pace has surprised analysts who have revised down diesel demand forecasts as a result and brought forward their predictions for a peak in Chinese oil demand. SCI's analyst Xu Lei said he cut the firm's China diesel demand expectations by 1-2% given the boom in electric truck sales. 'The surge in electric heavy trucks was a surprise and has become a new factor accelerating China's oil consumption to peak, most likely this year,' said Ye Lin, vice president at Rystad Energy, who had previously expected a 2026 peak. The transport sector, which burns about two-thirds of all diesel in China, will use 40% less by 2030, cutting overall diesel consumption by about a quarter compared to 2024 levels, according to Rystad. Diesel consumption this year is forecast to fall by 11.3 million tons, or 6.3%, on par with last year's drop, according to SCI. After more than six years behind the wheel of a diesel truck, Li Shuai, who drives for a cement plant in Hebei province near Beijing, switched to an electric truck six months ago. 'Charging infrastructure has improved noticeably in the past half year, making things much more convenient,' Li, 38, said. 'It is even possible to drive an empty truck more than 2,000km from Beijing to Yunnan to pick up goods without worry.' The rapid buildup of charging infrastructure, primarily through industrial corridors, is underpinning adoption, although charge times that can stretch to 90 minutes and limited charger availability in some areas remain issues. Teld, an EV charging infrastructure provider that has built more than 2,400 truck charging stations across China, officially opened an 800km corridor in March linking Shanxi and Shandong provinces, a key route via the country's coal-producing region. At a charging station next to the Hebei cement plant, car and truck chargers sit side by side in the dusty lot. Owner Yongji Liu had originally only planned to service EVs but said 'the electric truck market is growing so fast that we also installed chargers for trucks'. The booming market for electric trucks is partly due to cheap electricity and government subsidies introduced last July of up to 95,000 yuan (RM56,322) for new vehicles, analysts and truckmakers said. While diesel trucks are cheaper upfront, higher fuel costs make them more expensive after a million kilometers of driving. Once fuel is included, diesel trucks cost about 2.25 million yuan at the million-kilometer mark, roughly 10% more than LNG trucks and 15% more than electric trucks, according to GL Consulting. Rising fuel costs have also eroded some of the price advantage enjoyed by LNG trucks, which along with limited refueling stations in some regions, have hindered their growth, said SCI analyst Wang Neng. SCI forecasts LNG truck sales to hit around 92,000 units in the first half, down 15% from a year earlier, although the surge in electric adoption is more than offsetting the impact on diesel consumption. China's second-best-selling electric truck maker Sany says the growth potential for electric trucks is greater than for passenger EVs because lower operating costs bolster the profitability of corporate users. – Reuters
Time of India
11-07-2025
- Automotive
- Time of India
Soaring electric truck sales deal new blow to diesel use in China
Electric-powered heavy trucks are rapidly gaining market share in China, driven by subsidies and the quick rollout of chargers, further curbing diesel usage and denting oil demand from the world's biggest crude importer. The boom in electric truck sales in China follows that of electric cars and the rise in recent years of LNG-powered heavy trucks. Those factors, combined with slowing economic growth, have stifled its oil consumption growth. Sales in the world's biggest market for new energy trucks are estimated to have risen 175 per cent year-on-year to 76,100 in the first half of this year, or about a quarter of new truck sales, according to consulting firm Sublime China Information (SCI). Electric models, still mostly used for short-haul runs in ports, mines or steel mills, accounted for over 90 per cent of that increase. The rapid pace has surprised analysts who have revised down diesel demand forecasts as a result and brought forward their predictions for a peak in Chinese oil demand. SCI's analyst Xu Lei said he cut the firm's China diesel demand expectations by 1 per cent -2 per cent given the boom in electric truck sales. "The surge in electric heavy trucks was a surprise and has become a new factor accelerating China's oil consumption to peak, most likely this year," said Ye Lin, vice president at Rystad Energy, who had previously expected a 2026 peak. The transport sector, which burns about two-thirds of all diesel in China, will use 40 per cent less by 2030, cutting overall diesel consumption by about a quarter compared to 2024 levels, according to Rystad. Diesel consumption this year is forecast to fall by 11.3 million tons, or 6.3 per cent, on par with last year's drop, according to SCI. Beijing to Yunnan After more than six years behind the wheel of a diesel truck, Li Shuai, who drives for a cement plant in Hebei province near Beijing, switched to an electric truck six months ago. "Charging infrastructure has improved noticeably in the past half year, making things much more convenient," Li, 38, said. "It is even possible to drive an empty truck more than 2,000 km from Beijing to Yunnan to pick up goods without worry." The rapid buildup of charging infrastructure, primarily through industrial corridors, is underpinning adoption, although charge times that can stretch to 90 minutes and limited charger availability in some areas remain issues. Teld, an EV charging infrastructure provider that has built more than 2,400 truck charging stations across China, officially opened an 800 km corridor in March linking Shanxi and Shandong provinces, a key route through the country's coal-producing region. At a charging station next to the Hebei cement plant, car and truck chargers sit side by side in the dusty lot. Owner Yongji Liu had originally only planned to service EVs but said "the electric truck market is growing so fast that we also installed chargers for trucks". Cheaper than alternative The booming market for electric trucks is partly due to cheap electricity and government subsidies introduced last July of up to 95,000 yuan ($13,264) for new vehicles, analysts and truckmakers said. While diesel trucks are cheaper upfront, higher fuel costs make them more expensive after a million kilometers of driving. Once fuel is included, diesel trucks cost about 2.25 million yuan ($314,000) at the million-kilometer mark, roughly 10 per cent more than LNG trucks and 15% more than electric trucks, according to GL Consulting. Rising fuel costs have also eroded some of the price advantage enjoyed by LNG trucks, which along with limited refueling stations in some regions, have hindered their growth, said SCI analyst Wang Neng. SCI forecasts LNG truck sales to hit around 92,000 units in the first half, down 15 per cent from a year earlier, although the surge in electric adoption is more than offsetting the impact on diesel consumption. China's second-best-selling electric truck maker Sany says the growth potential for electric trucks is greater than for passenger EVs because lower operating costs bolster the profitability of corporate users. "We expect electric heavy trucks to account for 70 per cent to 80 per cent of new sales within as little as two to three years, driven by lower operating costs and more comprehensive charging infrastructure," said Zhaoting Yue, SANY's vice president of international marketing.
