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Strategies & Market Trends : China Warehouse- More Than Crockery -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (5246)	8/2/2005 1:12:29 PM
From: RealMuLan	Read Replies (2) \| Respond to of 6370

China sees 2005 crude oil demand up 6% REUTERS 4:42 a.m. August 2, 2005 BEIJING – China's demand for crude oil will rise about 6 percent to 310 million tons (6.2 million barrels per day) in 2005 from last year, the government estimated in a new survey that underscores weak domestic consumption data. Domestic crude output by the world's second-largest oil consumer would rise only 3 percent to 180 million tons (3.6 million bpd), the China Securities Journal reported on Tuesday, quoting the survey by the Commerce Ministry. Advertisement That will leave a shortfall of 130 million tons (2.6 million bpd), signalling a 6 percent increase from last year's average crude oil imports of 2.45 million bpd. Crude imports surged 35 percent last year, catching oil markets off guard and helping propel prices above $50 for the first time. But the pace of growth has slackened this year. China's demand for oil products would rise 5 percent to 230 million tons in 2005, the official Xinhua news agency said, quoting the same survey. Of the total, gasoline demand would exceed 54 million tons (1.25 million bpd), up 4 percent from last year, while diesel demand would rise 6.5 percent to 110 million tons (2.25 million bpd), Xinhua said. Fuel oil demand is expected to rise 5 pct to 54 million tons (0.95 million bpd), it said. China imported 63.42 million tons (2.56 million bpd) of crude oil in the first half of this year, a rise of 3.9 percent from the year-earlier period, customs data showed. Xinhua said domestic consumption of energy sources would continue to boom in the second half of the year, with short supply seen in some areas. IMPLIED WEAKNESS The crude demand forecast is in line with Chinese refinery processing rates, which rose 8 percent in the first half of the year to 5.85 million bpd, data has shown. Some crude oil is used directly by power plants or not captured in official data. But it overstates end-user demand because refiners have been exporting more oil products and importing less than last year to avoid loss-making sales on the regulated domestic markets. In the first half of the year, China imported a net 400,000 bpd of oil products, mostly fuel oil, customs data has shown. In January-June last year, it imported nearly 700,000 bpd. Assuming that trend is maintained through the rest of this year and added to the new crude oil demand forecast, Chinese implied oil consumption would come to about 6.6 million bpd this year – a scant 1.2 percent above the implied number for 2004. The International Energy Agency (IEA) last month lowered its forecast for Chinese consumption growth this year to 5.5 percent or 360,000 bpd, sharply below 15.4 percent in 2004. It estimated demand in the second quarter had fallen 1 percent year-on-year. The IEA said government price caps were limiting demand and warned of a downside risk to its forecast of higher second-half growth. However, many analysts expect imports to rebound and exports of fuels such as gasoline and diesel to slacken in the second half after a 6-plus percent increase in retail prices and the yuan's revaluation encouraging more domestic sales. They said a 9.5 percent economic growth in the first half should keep demand firm, despite weak published data. China's domestic crude oil production has risen faster this year than its normal 2 percent annual growth, with output up 4.8 percent year-on-year to 89.8 million tons (3.6 million bpd) in the first half, official data showed. But firms have also raised crude exports to capitalise on strong global markets, shipping out 145,000 bpd in the first half, nearly 18 percent more than a year before. China's imports of oil products totalled 15.7 million tons in the first six months, down 21 percent from a year ealier. signonsandiego.com