Fuel oil demand in China to decrease in 2007
Demand for fuel oil in China rose 8.8 percent annually from 2002 to 2006, primarily driven by petrochemical, transportation and building materials growth, as well as electricity and metallurgy development. In 2006, China consumed 480 million tons of fuel oil, being the largest consumer of fuel oil in Asia. Since 2004, demand for fuel oil in China keeps decreasing, and it will keep decreasing in 2007 because of its high price, and declining demand of fuel oil from power generation, etc.
Imported fuel oil to remain dominant China’s market
Increasingly larger domestic fuel oil market has to be fulfilled by imported fuel oil, due to the limited supply of Chinese fuel oil. As the economy in East China and China's coastal regions has developed fast in recent years, the demand for fuel oil in these regions has soared, thus pushing China to import more fuel oil, as these regions are short of energy. In 2004, China imported 30 million tonnes of fuel oil, while in 1995 the number was just 6 million tonnes.
South China becomes the largest fuel oil consumption region in China
South China is expected to enjoy the largest fuel oil market share in consumption. South China, centering around Pearl River Delta, is the largest regional fuel oil market in China, accounting for about 40% of China’s fuel oil consumption, because South China is an important manufacturing base of China with more developed technologies and wealthier consumers. East China, centering around Yangtze River Delta, the second largest regional fuel oil market, constitutes slightly less than one-third of China’s total fuel oil consumption.
However, there will be a few changes to the fuel oil consumption structure by region in China in the near future.
Transportation to be the largest fuel oil consumption field
In 2006, transportation industry consumed 10,564kts of fuel oil, surpassing electricity industry to become the largest consumer of fuel oil in China. Electricity used to be the largest consumption field of fuel oil in China, whose fuel oil consumption volume kept ranking No.1 before 2006, but its fuel oil consumption volume decreased year by year since 2004, because of the high price of fuel oil and the competition from coal and LNG in this field.
Study coverage
This report presents historical demand data as of 2006 and forecasts to 2007 by demand and output. The study also digs into the market factors for this industry, estimates the market share and profiles major players.
Report Highlights
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