China's Faltering Imports, Refinery Runs

Mobius Intel Brief:

China’s crude imports fell 8.7% Y/Y and 1.7% M/M in October, a trend mirrored in this week’s refinery runs and product output data.

Key Intel:

• China’s crude imports fell to approximately 10.43 MMb/d in October — down roughly 562 Kb/d month-on-month and -1.01 MMb/d versus 2023.

• Refinery runs similarly fell by 271 Kb/d v. September and dropped 1.04 MMb/d year-on-year. Refiners’ gasoline output declined by 233 Kb/d Y/Y, and diesel output sank 437 Kb/d.

• While transient refinery outages are responsible for some of October’s declines, China’s refinery runs have contracted on an annualized basis for 11 of the past 12 months at an average pace of -6.4% Y/Y.

• As noted in previous Intel Briefs, China’s latest round of stimulus measures primarily targeted the property sector’s ballooning inventory of unsold square-footage that has weighed on investment appetite. As a result, a material shift in development activity and downstream growth in commodity consumption will require more time than many market participants appreciate.

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