Independent refiners in Shandong cut run rates to 50.5% amid high feedstock costs and sluggish domestic fuel demand.
China’s independent teapot refiners have reduced refinery utilization to its lowest level since 2017, driven by elevated feedstock prices and weak domestic fuel consumption. Run rates in Shandong province fell to 50.5% last week, below even 2020 pandemic levels, according to industry data.
The decline reflects persistent margin pressures and restricted export quotas, which have constrained operations. Utilization rates last reached similar lows in August 2017, when market conditions were comparably strained.
The cuts signal ongoing challenges in China’s refining sector, with potential implications for global oil product supply and pricing.