China Teapot Refineries Challenge Japanese Exporters

iFeng: 日媒抱怨:中国原油品质赶上日本 中日面临“贴身肉搏”
In order to ensure that the benefits and mitigate the domestic excess inventory, Japanese oil companies attach great importance to exports. The status of the Japanese oil companies in trouble. In addition, Chinese oil product quality gradually improved, has been comparable with Japan, which became another worrying factor. Japan's high-quality light oil, the transaction price is higher, but due to the rise of Chinese manufacturers, "Japanese high-grade oil" has suffered a crisis.

Japanese oil companies, are wary of small independent refineries in China called "teapot refineries." Teapot refinery exports of petroleum products increased dramatically, and the quality gradually improved.

Chinese government before and after June 2015, with gasoline sulfur content of gas oil in the standard value or less as conditions allow independent refineries imported oil. Japan Tonen General Oil Company, "said independent refinery feedstock from the original heavy oil into crude oil, gasoline and diesel production ratio improvement."

Thereafter, the Chinese government in December 2015 and issued export licenses. Therefore, China's oil product exports increased rapidly. "Teapot refineries" refined gasoline and light oil can not be completely digested in the Chinese domestic market, the rest of the petroleum products into the Asian market.

...In addition to the crude oil feedstock shift from heavy oil outside the refinery equipment has changed. Tonen General Oil Company, said, "With China's domestic oil product quality standards and continuously improve the ability of oil refining equipment also appeared improved. As a result, the quality of China's petroleum products exports gradually achieved the same level as in Japan (the world's highest quality)."

...JX Energy, said, "After the end of 2015, China began exporting high-quality light oil to Australia", and Japanese products compete in the Asian market. Although the "Japanese high-grade oil" is facing a crisis, but Japan's oil prices take countermeasures only "concerned about the market at the same time there are profits to be made ​​to the region's exports."

JX Energy Senior Executive Officer Hua Guqing, "said August, it plans to export 89 million liters, an increase of 13 million liters. The main raw material for the jet of gas oil." Major oil companies plan to actively naphtha mainly exports to Asia. However, petroleum products on the Asian market glut.

In early August, Singapore's oil product inventories increased by nearly 1 percent, reaching a historic high. Current light oil profits of about $ 8 a barrel may further decline due to oversupply. Ito Minxian states that "if profits fall to about $ 5 a barrel, including gas oil, including oil exports will become more severe." Because of China's exports of petroleum products a huge impact on the Asian market, for teapot refineries increasingly high degree of attention.

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