SINGAPORE (Reuters) - PetroChina, China’s second-biggest state refiner, plans to reduce its crude throughput by 320,000 barrels per day (bpd) this month versus its original plan as the Wuhan virus hits fuel demand, a company official told Reuters on Monday.
PetroChina’s planned February cut is equivalent to about 10% of the refiner’s average production rate of around 3.32 million bpd. This would bring total production scalebacks by state refiners, include Sinopec Corp and China National Offshore Oil Company, to around 940,000 bpd for this month.
The cuts from PetroChina are likely to be deepened to 377,000 bpd in March, said the senior company official with direct knowledge of the matter. He declined to be named as he’s not authorized to speak to the press.
Reuters reported last week that Sinopec Corp, Asia’s largest refiner, is cutting its throughput this month by 600,000 bpd, or 12% of its average crude runs, its deepest reduction in over a decade. Independent Chinese refiners in Shandong, meanwhile, have slashed output to below half their capacity.
“The production cuts are mostly on refineries in northeast and north China, where demand is hit harder than in the western parts of the country,” said the PetroChina official.
PetroChina started the production cuts at the beginning of the month, but deepened them on Monday, the official said.
PetroChina did not immediately respond to a request for comment.
PetroChina is talking with its key long-term suppliers such as Saudi Arabia, Kuwait and the United Arab Emirates about possibly deferring cargo loadings or trimming loading volumes, the official said, without giving further details.
“We’re monitoring the market on a daily basis. But from what we’ve observed now, there seems little chance for a fuel demand recovery in March,” the official said.
Reporting by Chen Aizhu, with additional reporting by Muyu Xu in Beijing; Editing by Kim Coghill and Tom Hogue