Chinese refineries cut production with demand for oil falling
With Coronavirus continuing to take a toll on the markets of oil, the competition has been heating up for the suppliers of crude oil all of whom have been making an attempt to get a share in the oil demand in Japan and China where this demand has been dwindling because of the refineries cutting the run rates.
The suppliers of crude oil have been slashing prices now for few grades of the crude oil as per the officials of refineries and the trade managers. The difference in a lot of cases has been multiple dollars a barrel for the April loadings in comparison to the loadings in March.
Many flights are cut in and out of China and the travel in a few areas of this country has been restricted too. Resulting from the restrictions and the reduced output of the industry, the fuel demands from the nations which are otherwise thirsty for fuel have been at a continuous risk and have been sinking.
With the demands of China for fuel waning, the refiners have been coming face to face with an unfortunate reality and that reality is that the demand isn’t going to pick up anytime soon and it is better that they get comfortable and the comfort as of now is coming from cutting of the run rates.
The refiners of China have been cutting their production and the largest of the m has cut the production by 600,000 bpd. The cut is of 12% of the average it had seen in the year 2019.
The second largest one has also been cutting their runs of the refinery by 320,000 bpd.