China Crude Oil Output Lowest Since July 2013


BEIJING: China, the world’s fourth-largest oil producer, pumped 5.6 percent less crude year-on-year in April, official data showed, as oil firms struggled with cost pressures with crude prices hovering around $40 a barrel.

Data from the National Bureau of Statistics released on Saturday showed China produced 16.59 million tons of crude oil last month, or about 4.04 million barrels per day (bpd), the lowest rate since July 2013 on a daily basis.

A global oil supply overhang has eased this month thanks to unplanned outages caused by wildfires in Canada and further losses in Nigeria and Libya.

Deeper production cuts in China may give the market another boost.

Production in the first four months was down 2.7 percent over the same year-ago period to 68.14 million tons, or about 4.11 million bpd.

PetroChina, the country’s top producer, recorded a 0.2 percent drop in oil and gas production in the first quarter and Sinopec scaled back domestic crude production by 10.35 percent in the same period, companies said in April.

Offshore specialist CNOOC Ltd., however, delivered a 5.1 percent rise in total net oil and gas production in the first quarter over a year ago, thanks to new Chinese offshore fields.

Natural gas output last month rose 5.6 percent on the year to 10.6 billion cubic meters, with production up 5.3 percent in the first four months, the data showed.

Consumption of the cleaner fuel has regained some pace after the government cut wholesale city-gate prices last November.

National crude throughput gained 2.4 percent in April versus a year earlier at 44.75 million tons, or 10.89 million bpd. That compared to March’s runs at 10.58 million bpd.

Throughput in the first four months rose 2.9 percent on year to about 10.69 million bpd, according to the data.

Meanwhile, China’s key economic indicators moderated in April from the previous month, official figures showed on Saturday, raising worries over the strength of a rebound in the world’s second-largest economy.

Industrial output rose 6.0 percent year-on-year in April, the National Bureau of Statistics said, down from a 6.8 percent jump in March. Economists had estimated a 6.5 percent increase, according to Bloomberg News.

“Industrial production was lower than expectations, indicating that the stabilization momentum for the economy is not as strong as we imagined,” Liao Qun, China economist at Citic Bank International in Hong Kong, told AFP.
“There was a strong economic rebound in March, so there was a bit of a correction in April,” he said.
The Chinese economy grew at its slowest quarterly pace in seven years in the first three months of the year, expanding 6.7 percent, though the figure met market expectations and raised hopes it had started to improve.

Policymakers are seeking to wean China away from cheap exports and government-led investment to rely on domestic consumers as the key driver for growth in the world’s most populous country.
Separately, retail sales — an indicator of domestic consumption — rose 10.1 percent on the year in April, the bureau said, weaker than the 10.5 percent gain in March.

Fixed-asset investment, a gauge of government spending, rose 10.5 percent in the January-April period, it said. That was slower than the 10.7 percent rise in the first three months of the year.
Chinese officials say they are willing to accept slower growth to carry out structural reforms to retool the economy.

The People’s Daily newspaper, considered to be the mouthpiece of the ruling Communist Party, on Monday quoted a source as sounding a warning over using credit to drive growth.

China was likely to have an “L-shaped” growth pattern, suggesting it will remain flat, the “authoritative person” said.

The Asian giant’s economy grew 6.9 percent for all of last year, its weakest in a quarter of a century. Premier Li Keqiang in March set a growth target in a range of 6.5-7.0 percent for 2016.

The government has cut interest rates six times since late 2014 and also lowered reserve requirements — the proportion of funds banks must put aside — to boost the economy.

The central bank said on Saturday it would continue to support “stable” economic growth, according to a statement, a day after figures showed bank lending fell sharply in April, as the government refrained from boosting credit amid concerns over growing financial risk.

Other economic figures for April which have already been released show a mixed picture. Manufacturing activity slowed for the month and both exports and imports dropped, indications of weakness in the economy.

Consumer price inflation was stable at 2.3 percent in April but the producer price index — which measures prices of goods at the factory gate — fell 3.4 percent, actually its slowest decline in 16 months.



Back to top button

Adblock Detected

Please consider supporting us by disabling your ad blocker