The CDU capacity utilization rates of independent refineries in Shandong Province hit a 22-month low at 53.2% in the week ended March 21, and rebounded 0.36% in the following week ended March 28, primarily due to narrowing refining profits on the backdrop of rising cost and flat end-market demand, per OilChem data.
Source: Mysteel OilChem
In detail, the CIF prices of ESPO were with momentum due to resilient Brent prices, and jumped Yuan 681/tonne or 15% as of Thursday March 28, compared with the beginning of this year. The prices of Malaysia blend rose even more rapidly by Yuan 870/tonne or 22% during the same period.
Source: Mysteel OilChem
However, the refined oil prices were rather flat compared with the crude oil. Taking #92 gasoline produced by the independent refineries in Shandong as an example, the price inched up merely 2.7% or Yuan 228/tonne compared with early 2024, while #0 gasoil prices went up slightly by 2% or Yuan 141/tonne, squeezing the theoretical refining profits of independent refineries.
Source: Mysteel OilChem
In response to the narrowing profits, the independent refineries in Shandong Province continuously lowered the capacity utilization rates and recorded 53.56% on average in the week ended March 28, down around 7% compared with the beginning of 2024, equaling to a daily throughput loss of 33,000 tonnes.
Looking ahead, it is projected that the CDU capacity utilization rates will remain low in the near future as a number of refineries will commence maintenance in late April.
Written by Aggie Hu, huchenying@mysteel.com
Edited by Navy Liu, liuchuanjun@mysteel.com