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(Bloomberg) China’s ever-expanding oil refining capacity will increase competition among crude processors around the world and weigh on their margins, the nation’s biggest energy producer said.
Refining capacity will reach 900 million tons this year and rise to 980 million tons by 2025, according to a report from Economics & Technology Research Institute, which is affiliated with China National Petroleum Corp. Capacity will outstrip local demand by at least 160 million tons a year by 2025, CNPC said.
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China’s Mega-Refineries Throttling Other Asia Oil Processors
Sun Online Desk
SK Innovation’s oil refinery facilities in Ulsan, South Korea. Photographer: SeongJoon Cho/Bloomberg
The rise of China’s mega-refineries was always going to make life tougher for their competitors across Asia. But the fallout from Covid-19 is hastening the impact and accelerating consolidation across the region.
A frenzy of refinery building in China is set to make the nation the world’s largest crude processor this year. At the same time, a drive to de-carbonize Asia’s biggest economy means demand for fuels like diesel and gasoline will decline, potentially leading to more exports from the new facilities.
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China’s natural gas demand set to hit new record
China’s natural gas demand is expected to set a new record in 2021 as its economy emerges from the pandemic faster than most countries and it remains on track to meet its long-term environment protection targets, data from S&P Global Platts Analytics and state-owned Sinopec’s research arm showed Jan. 7.
S&P Global Platts Analytics expects Chinese natural gas demand to reach 360 Bcm in 2021, up 8.4% from an estimated 332 Bcm in 2020. It was at 313 Bcm in 2019.
State-owned Sinopec has a slightly more conservative outlook, and expects gas demand at around 340-345 Bcm in 2021, up 6%-8% from an estimated 320 Bcm in 2020, data from its unit Institute of Economic Research showed.