The vice president at the CNPC institute says while crude oil demand in China is expected to grow in 2017, the shift to renewable energy will eventually hamper the consumption growth for oil products. CNPC photo.
CNPC says China’s oil demand will grown to almost 12 million b/d
BEIJING, Jan 12 (Reuters) – China’s crude oil demand will grow by 3.4 per cent this year to a record of almost 12 million barrels per day (b/d), the country’s top state-owned oil producer CNPC forecast on Thursday, as refiners in the world’s second-biggest oil user ramp up output.
The robust outlook for crude combined with surging vehicle sales in the world’s largest auto market boosted oil futures even as the report cautioned that demand growth for products like gasoline and diesel will slow and the domestic fuel glut will remain a significant problem.
Total crude oil consumption will hit 594 million tonnes, or 11.88 million b/d, state-owned China National Petroleum Corporation (CNPC) forecast in an annual report released by its research institute.
Total refinery throughput will rise by 3.3 per cent to 557 million tonnes, or 11.2 million b/d, with refiners adding 702,000 b/d of net capacity. That will increase to 11.8 million by 2020, it said.
The rising refinery demand will lift crude imports by 5.3 per cent to 396 million tonnes, or 7.95 million b/d. By 2020, it forecast imports will hit 8.2 million b/d.
But, the rising refinery runs will maintain the domestic supply glut that has forced refiners to export into a saturated Asian market in recent years.
The domestic refining glut will be at least 2.2 million b/d by 2020, but could surpass 3 million b/d if the market worsens, it forecast.
CNPC predicts that net exports of diesel will surge by 55 per cent this year to 22.4 million tonnes, or about 450,000 b/d.
In addition, slowing growth in the world’s second-largest economy and the shift to renewable energy will hamper the consumption growth for oil products, the report said.
“Energy giants will die like dinosaurs if they don’t diversify into other energy products and into clean energy,” said Liu Zhaoquan, vice president at the CNPC institute, at a briefing.
(Reporting by Muyu Xu, Stella Qiu and Beijing newsroom; writing by Josephine Mason; Editing by Christian Schmollinger)