China refinery throughput surges

China saw a record high refinery output during the month of November, according to data from the National Bureau of Statistics released on Tuesday.

Both the completion of scheduled maintenance and growing production from smaller refinery are thought to be responsible for the 3.4% year-on-year increase in throughput. The increase in volumes translates into around 11.14 million bpd or roughly 45.77 million tonnes.

Sinopec and CNPC/PetroChina together account for 72% of China’s total refining capacity. Sinopec is the world’s second-largest refining company by capacity and has a strong refining presence in China’s coastal and southern provinces. The remaining refining capacity is controlled by smaller independent companies, usually referred to as teapot refineries.

The rise in output does little to address the excess in the market. China has steadily increased its petroleum refining capacity, which stood at 10.5 million bpd in 2015, although local demand for refined products has been slowing. China’s daily crude output fell by 9% in November 2016 compared to 2015 values. That year, the National Development and Reform Commission increased export quotas for Chinese refineries from 60 million to 73 million barrels of petroleum products amid domestic saturation.