Latest news with #SinopecGroup
Business Times
07-07-2025
- Business
- Business Times
After petrol, China's oil refiners face a jet fuel glut
[NEW YORK] China's oil refiners are grappling with an oversupply of jet fuel, in yet another blow to the bottom line of a sector already dealing with ebbing demand for petrol and diesel. In the post-pandemic period, as flights returned to the skies, jet fuel was a boon for domestic refiners struggling with a sputtering economic recovery, the electrification of the car fleet and trucks turning to alternatives such as liquefied natural gas. Refiners piled into aviation, using up feedstock that in the past would have gone into road-transport fuels. Now, though, there may be too much of a good thing. Supply this year is already running over 40 per cent ahead of demand, according to data from analytics firm Kpler. In the long term, structural changes, like the build out of high-speed rail, stand to limit future growth. 'Jet was China's solution to demand destruction in gasoil and petrol, but all it did was shift the problem elsewhere,' said Zameer Yusof, a middle distillates analyst at Kpler, who forecasts a surplus of 390,000 barrels per day in the country this year. 'Chinese international travel looks weak, contributing to the glut we are seeing.' Granted, consumption is set to keep climbing in 2025 as more aircraft take flight and a larger proportion of the population travels – but it's still short of the growth that the refining system needs to absorb the extra production. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up A pivot towards domestic travel in recent years, at the expense of international routes, has not helped, slowing the growth trajectory further. Other headwinds include an uncertain outlook for consumer spending, plus newer, more fuel-efficient aircraft and better management by airlines eager to trim the consumption necessary for each flight. With 'limited options for relief', Chinese refinery margins will remain under pressure, Yusof said. Export trouble As with much of China's excess capacity, much of this may turn into a headache beyond its borders. Last month, Kpler forecast the nation's June exports would reach a record 2.6 million tonnes, potentially displacing flows into the region from the Middle East and India. China's refineries have been struggling with paper-thin margins for years. China's diesel demand likely peaked in 2019, while the nation's electric-vehicle boom means petrol consumption may have crested in 2023, the chairman of top refiner Sinopec Group said in March. Beijing has urged a shift towards making more petrochemical products – including ethylene, a key building block for many plastics – but that has done little to ease the financial pain. 'There is already too much ethylene-producing capacity in China,' said Manish Sejwal, a natural gas liquids analyst at Rystad Energy. 'This is all happening at a time when demand for ethylene remains clouded by a slowing global economy.' The country plans to add six million tonnes of ethylene production capacity in 2025, and a further 20 million tonnes over the next three years, according to Rystad, taking total capacity to 70 million tonnes. Bloomberg
Zawya
02-06-2025
- Business
- Zawya
Saudi: ADES Holding expands West African footprint via $34.4mln contract award
Riyadh – ADES Holding Company has been awarded a SAR 128.90 million contract for the use of Admarine 510 in Cameroon, marking the Saudi group's entry into its 13th country of operations. The one-year deal also aligns with the company's expansion across the high-potential West African market, according to a press release. The contract has been awarded by Addax Petroleum, a subsidiary of Sinopec Group. It is expected to commence in the fourth quarter (Q4) of 2025. The contract covers a firm twelve-month drilling campaign, with two optional extensions of six months each, for a total potential duration of up to 24 months. Mohamed Farouk, CEO of ADES Holding, said: 'This award reflects the growing trust in ADES as a leading provider of offshore drilling services in the region, and we are particularly pleased to be working directly with Addax Petroleum, a reputable operator affiliated with a major national oil company.' 'The award of this long-term contract reinforces our ability to respond quickly to new opportunities and sustain fleet deployment across our core markets,' Farouk added. He noted: 'By building on our recent successes in Nigeria and now expanding into Cameroon, we are building the right critical mass for optimized operations as we reinforce our long-term commitment to West Africa aiming to deliver high-quality, efficient, and safe drilling services to our clients.' Last April, ADES Holding extended three of its offshore jackup rigs operating in Egypt, with a total estimated backlog value of SAR 673.50 million ($179.60 million).
Forbes
21-04-2025
- Business
- Forbes
Prolonged Trade War May Wipe Out 50% Of China's Oil Demand Growth
Tugboats push a crude oil tanker to a reception terminal operated by Sinopec Group on January 30, ... More 2023 in Zhoushan, Zhejiang Province. China. The wider oil market sentiment continues to be bearish given the possibility of a global trade war, potential recessionary headwinds in major demand centers and higher crude production. But the first of these three factors could have an outsized impact on China, according to one market analysis outfit. In a note to clients on Monday, Rystad Energy said a prolonged trade war carries the potential of wiping out half of China's oil demand growth. Were such a scenario to materialize, the slump in global oil prices will likely be inescapably huge. Should downside risks to the country's outlook materialize, Rystad's analysis points to China's projected 2025 oil demand growth of 180,000 barrels per day falling by 50%, 'The ongoing trade war has upended markets' global economic outlook, hitting commodity prices and changing the oil demand outlook. The uncertainties of U.S. President Donald Trump's tariff policies disrupted the markets' original trajectory and posed concerns over the macro economy and demand outlooks,' Rystad told clients. Before Trump Tariffs introduced a seismic shock to the global economy, China's Q1 2025 GDP growth beat expectations at 5.4%, together with other macroeconomic indicators showing growing signals such as exports, the Purchasing Managers' Index and retail sales. 'Strong economic growth in Q1 was also based on last September's stimulus taking effect gradually,' Rystad observed. 'But assuming trade relations between China and the U.S. remain disrupted, we expect a mild scenario is very likely for this year, with China's GDP growth slowing down by one percentage point.' The impact of slower GDP growth on Chinese oil demand growth would be a deceleration of 0.47 of a percentage point, as the economy is still relatively industry- and export-driven, it added. 'With the country set to announce more stimulus in the face of the trade war, we expect some upside potential to offset the negative impact from the trade war and mitigate the oil demand growth loss. Overall, the current estimate indicates a loss of 90,000 bpd growth in oil demand from 180,000 bpd levels.' The research outfit reckons the biggest loss will likely be in diesel and biggest gain in naphtha which may offset 'some' demand loss. Unsurprisingly, petrochemical and diesel demand will bear 'the most downside pressure because of the trade war', as consumer spending and industry prosperity and industry-related transportation will be 'damaged' by potential trade decline. The country's domestic petrochemical feedstock demand could be supported by less dependence on imports amid the elevated tariffs. 'Liquefied petroleum gas demand growth will slow down with a shift towards naphtha demand upside as a potential utilization rate increase of steam crackers will offset the loss from propane dehydrogenation [or 'PDH'] as propane relies on external supply.' But around 100,000 bpd of propane demand will be at risk if the trade war sustains and PDH operators are unable to pivot, with the U.S. dominating supply, Rystad added. Domestic gasoline and jet fuel demand, strongly associated with personal and business mobility, will not be negatively impacted in a mild trade war scenario. 'There could, however, be some restructuring between international and domestic travel and potentially a changed average distance of travel, while some upside potential exists as lower prices are likely to boost consumption,' Rystad concluded. Overall, however short or long a trade war may turn out to be, higher production and lower demand growth implies the crude market may continue to remain rocky for some time yet.
South China Morning Post
15-04-2025
- Automotive
- South China Morning Post
China's EV battery king CATL joins with Sinopec to build swapping-station network
Advertisement The company, based in Ningde, in east China's Fujian province, will partner with oil giant Sinopec Group and smart EV assembler Nio to create a charging network covering the mainland, it said in a filing with the Shenzhen Stock Exchange on Monday. In addition, the company said Hong Kong and Macau would soon see their first swap stations, which allow owners of compatible EVs to exchange a spent battery pack for a fully charged one in just 100 seconds. CATL and Sinopec committed to an 'extensive and long-term strategic partnership' to build a 'battery-swapping ecosystem across the whole nation', according to the agreement signed early this month. CATL said it aimed to build 30,000 swapping stations, without giving a specific timetable. 'CATL's efforts to promote battery swapping nationwide, particularly with Sinopec as a partner, will convince more EV makers and drivers of the advantage of using this technology because it is faster and more efficient,' said Davis Zhang, a senior executive at Suzhou Hazardtex, a supplier of specialised batteries. 'As more stations are built, an increasing number of new models will adopt swappable batteries to attract car buyers.' Advertisement Swapping technology aims to ease range anxiety. At present it takes at least 10 minutes via ultra-fast charging technology to give an EV 400km of driving range. However, BYD has unveiled a charging technology that it claims can provide the same range in just five minutes
Bloomberg
06-03-2025
- Business
- Bloomberg
China's Fuel Production Cuts Could Undermine Global Oil Demand
China's pushing its oil refiners to reduce fuel output, raising new questions about demand in the largest importing nation just as the world's drillers need buyers for the extra barrels they're adding to the market. The country's top economic planner wants the industry to cut production of refined petroleum products and increase output of chemicals, according to its annual work report at the National People's Congress on Wednesday. The order isn't necessarily surprising — top refiner Sinopec Group said earlier in the week that consumption of both diesel and gasoline has peaked, leaving petrochemicals as the major growth driver for demand.
