By Jim Bai and Tom Miles
BEIJING, July 8 (Reuters) - China's leading refineries will raise their crude oil processing in July to fresh highs from record levels in June, encouraged by recent fuel price hikes and rising sales amid increasing signs of economic recovery.
China raised diesel and gasoline prices by 9-10 percent on June 30 after hiking them by 6-7 percent on June 1, giving a boost to refiners faced with rising crude oil costs.
"This is already the best time compared with the past year and you have no reason not to move up operations," said an official with a refinery in eastern China, who declined to be named as he was not authorised to speak to media.
Twelve major plants accounting for more than a third of China's capacity, most of them on the eastern and southern seaboards, will process 2.67 million barrels per day (bpd) of crude oil in July, up more than 1 percent from the 2.64 million bpd in June, a Reuters poll showed.
The July volume would represent around 90 percent of their total refining capacity.
For a history of crude runs by these plants, please click: here
The increase would come mainly because Dalian, PetroChina's (0857.HK)(601857.SS) largest refinery, began raising runs since last month and Fujian, a joint venture between Sinopec (600028.SS) (0386.HK), Exxon Mobil (XOM.N) and Saudi Aramco, began churning out fuels from a new facility after starting trial runs from May.
Previously, Dalian's crude processing volumes only surpassed 300,000 bpd in October and November last year, despite claims before the Beijing summer Olympics to have become China's largest plant with capacity of 410,000 bpd.
Only Sinopec's Jinling refinery plans a moderate cut in crude throughput in July because of maintenance of some secondary facilities. [ID:nPEK101358]
MORE RUNS AHEAD?
China's fuel stocks have been largely in decline since earlier this year while fuel sales have been gradually picking up, in line with a similar trend in power demand, as more and more indicators showed the economy was stabilising and even moving towards an early recovery.
With crude oil prices CLc1 plunging in recent days from a 2009 peak on June 30 of $73.38 a barrel, analysts and industry officials were gaining confidence that the outlook for the refining sector will not get worse, at least for the near future.
"Crude processing is likely to continue growing in the third quarter as the demand is there," said Yan Beina, an analyst with Guosen Securities.
"Many refineries have prepared themselves for more production by bringing maintenance forward to the first half of this year when demand was comparatively low."
In addition, new refineries that are coming on line will boost production capacity and possibly replace some need for imports, she added.
Also, China was expected to continue to curb diesel exports in July as oil firms will probably hold back more for the domestic market, traders have said. [ID:nSP538750] ======================================================== PLANT JULY RUNS JUNE RUNS REFINING CAPACITY
(bpd) ======================================================== Zhenhai 381,500 377,200 400,000 Maoming 282,600 287,100 270,000 Qilu 211,900 209,300 200,000 Gaoqiao 211,900 216,600 230,000 Guangzhou 226,100 219,000 270,000 Jinling 240,200 272,500 270,000 Dalian 329,700 328,500 410,000 Lanzhou 211,900 209,100 200,000 Fujian 121,000 80,000 240,000 Jinzhou 141,300 138,700 140,000 Jinxi 122,500 121,700 150,000 WEPEC 186,000 182,500 200,000 ======================================================== TOTAL* 2.67 2.64 2.98 ========================================================
*in million bpd. (Additional reporting by Eadie Chen; Editing by Michael Urquhart)
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