RIYADH: Oil prices were mixed on Tuesday after China posted its weakest annual economic growth in nearly half a century, with its late-2022 u-turn in COVID-19 policy underpinning hopes of a recovery in the country’s fuel demand this year.
Brent crude futures edged up by 15 cents, or 0.19 percent, to $85.08 at 12.35 p.m. Saudi time, recouping some of the 1 percent loss in the previous session.
US West Texas Intermediate crude futures slid 73 cents, or 0.9 percent, to $79.71 from Friday’s close. There was no settlement on Monday because of the US public holiday for Martin Luther King Day.
China’s gross domestic product expanded 3 percent in 2022, badly missing the official target of “around 5.5 percent” and marking the second-worst performance since 1976, as the last quarter was hit hard by stringent COVID-19 curbs and a property market slump.
China’s oil refinery runs fall for first year since 2001
China’s oil refinery throughput in 2022 fell 3.4 percent from a year earlier, its first annual decline since 2001, as the Asian giant's rigid COVID-19 controls took a toll on the economy and fuel consumption.
Refiners processed 675.9 million tons of crude oil last year, data from the National Bureau of Statistics showed on Tuesday, or about 13.5 million barrels per day.
Crude throughput in December rose 2.5 percent from the same month a year earlier to 59.88 million tons, the NBS reported, or 14.1 million bpd, the second-highest amount of 2022 on a daily basis as refiners ramped up production to use up fuel export quotas.
This is just down from 14.5 million bpd in November and the record of 14.8 million bpd in June 2021.
Following eight months of consecutive year-on-year declines between January and August, refinery processing began a rebound in September as the government shifted its fuel trade policy by issuing a large set of quotas to spur exports.
Fourth-quarter refined fuel exports, including diesel, gasoline, aviation fuel and marine fuel oil, surged 61 percent over a year-ago period to 18.3 million tons.
The start-up of PetroChina’s new 200,000-bpd crude unit in Guangdong and Shenghong Petrochemical’s 320,000-bpd plant in Jiangsu also helped support run levels during the last few months of 2022.
Crude oil production remained firmly above the 4 million bpd mark, a level regarded by the state-dominated sector as strategic to ensure domestic supply security, as companies stepped up developing more challenging reservoirs.
Last year’s output was up 2.9 percent from 2021 at 204.67 million tons, or 4.1 million bpd, with December output up 2.5 percent on the year at 16.87 million tons.
UK oil, gas licensing round attracts 115 bids, similar to previous round
Britain’s first oil and gas licensing round since 2019 attracted 115 bids, compared with 104 in the last round, with licenses likely to be awarded from the second quarter, the North Sea Transition Authority said on Tuesday.
Britain’s government is looking to boost domestic hydrocarbon output as Europe weans itself off Russian fuel, but climate activists have criticized the licensing round, and Greenpeace is working on a legal challenge.
Britain’s recent increase in a windfall tax on the oil and gas sector has pushed the UK North Sea’s biggest oil and gas producer, Harbor, to shun the licensing round.
Still, the round attracted 115 bids from 76 companies for 258 out of 931 blocks on offer — compared with 104 bids for 245 blocks out of 768 on offer in 2019, the NSTA said.
The British North Sea, home to the global Brent benchmark grade, is an aging basin where oil and gas production has fallen from a 1999 peak of around 4.4 million barrels of oil equivalent to around 1.5 million boed.
While hosting the 2021 COP26 climate summit, Britain decided not to join an alliance of countries vowing to stop new oil and gas projects on their territory.
