RIYADH: Oil prices fell on Monday as weak China economic data triggered concerns about demand at the world’s largest crude importer while the head of the world’s top exporter, Saudi Aramco, said it was ready to ramp up output.
Brent crude futures were down 1.78 percent, to $96.37 a barrel at 11.10 a.m Saudi time.
US West Texas Intermediate crude futures were down 1.74 percent, at $90.35.
July refinery output in China drops to over 2-year low on plant outages
China’s refinery crude throughput fell last month to its lowest since March 2020 as several state refiners underwent unplanned shutdowns and their independent peers trimmed production in response to thinning margins.
Refiners processed 53.21 million tons of crude oil in July, 8.8 percent less than a year earlier, according to data from the National Bureau of Statistics.
That is equivalent to 12.53 million barrels per day, the lowest daily rate since March 2020, and compared with 13.37 million bpd in June.
The weaker throughput in July extended a rare decline in China’s refinery processing seen in the first half of 2022 as strict COVID-19 lockdowns and fuel export controls curbed their production.
During the first seven months, refineries processed 380.27 million tons, down 6.3 percent from a year before and equal to about 13.09 million bpd.
Prolonged outages at large state-run refineries such as Sinopec Shanghai Petrochemical Corp’s 320,000-bpd crude facility and PetroChina Wepec’s 200,000-bpd plant weighed on national production.
Sinopec did not resume refining at some of the units at the Shanghai plant until last week, while the northeast Liaoning-based Wepec was not expected to resume operation until late August after nearly three months’ shutdown, said an industry source.
Singapore marine fuel sales rebound to 7-month high in July
Marine fuel sales in Singapore, the largest bunkering hub in the world, rose by 10 percent month-on-month to a seven-month high of 4.12 million tons in July, the latest data from the Maritime and Port Authority of Singapore showed.
The uptick came amid a rise in vessel arrivals for bunkering, which climbed 8 percent month-on-month to 3,181 vessel calls in July. Bunker fuel prices were also lower in July versus June, amid softer upstream crude prices.
Sales for both low-sulfur fuel oil and high-sulfur fuel oil grades climbed from the previous month, the MPA data showed.
LSFO supplied to ships climbed by 7 percent month-on-month to 2.51 million tons in July, though the sales fell by 7 percent year-on-year.
Low-sulfur bunker fuel premiums were still elevated in the first half of July, at a time when cargo premiums rallied to record highs, before trending lower toward the end of the month.
Meanwhile, HSFO supplied to ships rose by 16 percent month-on-month to 1.27 million tons in July, and was 20 percent higher year on year.
(With input from Reuters)