China's apparent oil demand* in March increased 6.5% from a year earlier to 44.73 million metric tons (mt), or an average 10.58 million barrels per day (b/d), according to a just-released Platts analysis of Chinese government data.This was the highest growth rate witnessed since September 2014.

China's refinery throughput in March averaged 10.57 million b/d, rising 5.5% from a year earlier, data from the country's National Bureau of Statistics showed April 15.
On the other hand, net oil product imports fell to a four-month low of 40,000 mt, according to data released April 13 by the General Administration of Customs.

During the first quarter of this year, China's total apparent oil demand was up 4% year over year to an average 10.48 million b/d, the highest pace of growth over the same three-month period since 2012. This came despite China's GDP growth sinking to 7% for the quarter, the slowest quarterly rise in six years.

"Apparent oil demand appears to be strengthening against a low base from a year ago, even though the economic outlook remains bleak," said Platts senior writer for China, Song Yen Ling. "But there could be some support with continued loosening of credit controls by the government which could boost infrastructure investment."

Gasoil demand growth improves
Apparent demand for gasoil - the most widely consumed oil product in China - rebounded from a contraction in February to grow 7.5% in March to 15.51 million mt. Actual consumption, however, was likely lower as there was some stock-building during March.

Up to 70% of the fuel is used in the transport sector while the remainder is used by various sectors, including construction, farming and fishing, industrial heating and to power machinery.

Apparent demand for gasoil was up 4% over January to March to 43.62 million mt, in contrast to the contraction in the first quarter of 2014.

Gasoline
Meanwhile, apparent demand for gasoline climbed 8% year over year to 9.56 million mt, with year-to-date demand also rising 8% to 27.67 million mt, buoyed by higher passenger car sales.

Fuel Oil
Fuel oil witnessed a further decline in demand following consumption tax increases in the fourth quarter of last year, which has made the fuel more expensive for the country's independent teapot refiners to buy. These refiners use imported fuel oil as an alternative feedstock in the absence of crude import rights.

Apparent demand for fuel oil in March slumped 8.1% year over year to 2.88 million mt. Net fuel oil imports fell 4.2% during the month to 690,000 mt. Apparent demand for fuel oil during the first quarter tumbled 17.2% to just over 8 million mt.

Month-to-month demand in China is generally viewed to be subjected to short-term anomalies which are of interest and important to note, but often fail to reveal the country's underlying demand trends. Year-to-year comparisons are viewed by the marketplace to be more indicative of the country's energy profile.

*Platts calculates China's apparent or implied oil demand on the basis of crude throughput volumes at the domestic refineries and net oil product imports, as reported by the NBS and Chinese customs. Platts also takes into account undeclared revisions in NBS historical data.

The government releases data on imports, exports, domestic crude production and refinery throughput data, but does not give official data on the country's actual oil consumption figure and oil stockpiles. Official statistics on oil storage are released intermittently.

Platts releases its monthly calculation of China's apparent demand between the 18th and 26th of every month via press release and via its website. Any use of this information must be appropriately attributed to Platts. Platts uses a conversion rate of 7.33 barrels of crude per metric ton, the widely-accepted benchmark for markets East of Suez.
Source: Platts