Latest official Chinese oil stats show that refinery runs remained subdued at 12.73mn b/d for May, the second lowest figure since the ‘peak Covid’ month of March 2020. The lowest was the previous month: with runs at just 12.64mn b/d for April, the 5M 2022 average of 13.45mn b/d is down 5% year-on-year. With the threat of renewed Covid-related lockdowns in Beijing, Shanghai and elsewhere, it is far from guaranteed that Chinese oil demand will rebound over the coming months.

Run rates have also been impacted by Beijing’s decision to allocate conservative export quotas to refiners. Quotas for the year have recently been increased, but remain down on 2021 levels. This has caused considerable external chagrin at a time when refining margins have spiked to record levels. (CONTINUED - 381 WORDS)