Sinopec expects China’s oil demand to recover in Q2 and positive growth in 2022
BEIJING (Reuters) – China’s Sinopec Corp expects demand for refined petroleum products to pick up in the second quarter as the country’s COVID-19 outbreaks are gradually brought under control, and sees oil consumption on the rise. whole year to achieve positive growth.
Asia’s largest oil refiner has cut refining cycles since the second half of March and is maintaining an “optimal” refining operating rate of around 85%, down from 92.6% earlier in the year , Sinopec officials said at a briefing on Thursday.
Cities across China, including the financial hub of Shanghai, have been placed on lockdown following a spike in COVID-19 cases, leading to road freight bottlenecks and port congestion.
“Anti-COVID measures have limited the consumption of refined petroleum products. But we expect oil demand to pick up gradually in the second quarter with the pandemic outbreak under control,” said Li Li, deputy head of the department. management of Sinopec’s operations.
“Right now, we’re confident about fuel consumption in China in 2022…Even if the recovery in the second quarter is moderate, growth for the full year will remain positive.”
Sinopec also expects its total liquefied natural gas (LNG) imports to remain stable in 2022.
The company suffered a loss of 1.6 billion yuan ($243.58 million) on its 4.8 million tons of LNG imports in the first quarter, 1.2 billion yuan more than a year earlier due to high import costs.
Sinopec officials said the company is reducing its purchases of spot LNG cargoes and will focus more on futures contracts in the coming months.
($1 = 6.5686 Chinese yuan renminbi)
(Reporting by Chen Aizhu and Muyu Xu; Writing by Dominique Patton; Editing by Muralikumar Anantharaman & Shri Navaratnam)