In a report despatched to Rigzone not too long ago, analysts at BMI, a Fitch Options firm, famous that they now anticipate stronger progress in Australia’s refined gas demand in 2023, “pushed by surging demand for air journey, which shall be maintained by to the tip of the yr”.
“We’ve got revised up our forecast for Australia’s refined gas demand in 2023, from predicting two % yr on yr progress beforehand to now predicting six % yr on yr progress,” the analysts stated within the report.
“This may see the nation’s complete demand enhance to 1.065 million barrels per day, simply shy of the pre-pandemic 1.088 million barrel per day stage of demand seen in 2019,” they added.
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Within the report, the analysts outlined that Australia’s demand for jet gas/kerosene within the first quarter of 2023 elevated by 67 %, or 55,000 barrels per day, relative to the identical interval final yr. Previous to the pandemic, jet gas/kerosene had constituted on common 15 % of the nation’s complete oil demand all through 2015-2019, nevertheless, pandemic-era restrictions on air journey noticed its share decline on common to seven % in 2021 and 2022, the analysts famous within the report.
“Business commerce teams are reporting very sturdy demand for home air journey in Australia initially of 2023, reportedly greater than doubling compared to a yr in the past,” the analysts stated within the report.
“Furthermore, there may be room for additional progress provided that home air journey nonetheless stays at roughly 90 % of pre-pandemic ranges,” they added.
“The restoration can even be supported by the revival of air journey routes to mainland China because the nation’s financial reopening. Previous to the pandemic China stood as the most important supply of tourists to Australia,” they continued.
The most recent statistical evaluate of world vitality, which was printed by the Power Institute (EI) final month, confirmed that Australia’s complete oil liquids consumption was 1.012 million barrels per day in 2022, 944,000 barrels per day in 2021, 919,000 barrels per day in 2020, and 1.069 million barrels per day in 2019.
The very best complete oil liquids consumption yr for Australia, in line with the report, which stretched again to 2012, was 2018, when the nation was proven to have consumed 1.080 million barrels per day. The yr with the bottom consumption was 2020, the report highlighted.
From January 3, 2020, to June 28, 2023, 5.56pm CEST, there have been 11.495 million confirmed circumstances of Covid-19 in Australia with 21,685 deaths, in line with the newest knowledge from the World Well being Group (WHO). As of March 24, 2023, a complete of 65.492 million vaccine doses have been administered within the nation, WHO figures present.
Australia Refining Output, Refined Gasoline Import
Of their report, analysts at BMI famous that deliberate upkeep work and an outage at Australia’s two refineries will see refining output contract this yr.
“We keep our forecast of a 2.5 % yr on yr decline in Australia’s refining output in 2023, regardless of output within the first three months of 2023 remaining flat relative to final yr,” the analysts stated within the report.
“Output will weaken within the the rest of 2023 on account of deliberate main upkeep work that’s presently going down on the Geelong refinery (120,000 barrels per day), which is predicted to final for about six weeks,” they added.
“Moreover, the fluidized catalytic cracking unit (FCCC) that produces roughly 18,000 barrels per day of gasoline on the Lytton refinery has been offline since March 2023 on account of an outage brought on by mechanical points,” they went on to state.
Over the long run, the analysts famous within the report that they maintain a bearish outlook on Australia’s refined fuels manufacturing. They highlighted within the report that they anticipate this to say no by 20 % by the tip of their forecast interval, which stretches to 2027, “to 207,000 barrels per day of output”.
“The nation’s two remaining refineries will battle to compete with rising competitors from refiners within the Center East and Asia, which stand to learn from scale and price benefits, along with geographical proximity to a number of the largest oil importing markets on this planet,” the analysts warned within the report.
“On this regard, we see China’s refining capability rising by 1.2 million barrels per day by 2027. Equally, Kuwait and the UAE will see a mixed extra capability of 680,000 barrels per day by 2027, supported by the brand new 615,000 barrel per day Al Zour mega refinery, which we anticipate to develop into totally operational by 2024,” they added.
In flip, it will additional exacerbate Australia’s refined gas import dependency within the close to time period, the analysts acknowledged within the report.
“We now see Australia’s imports of refined fuels rising to 805,000 barrels per day in 2023 from 738,000 barrels per day in 2022,” the analysts stated within the report.
“This may stand to learn regional refined gas export companions corresponding to South Korea, Malaysia, Singapore, and China. Australian authorities knowledge signifies that the 4 international locations constituted 70 % of Australia’s refined gas imports in December 2022, with scope for additional progress within the close to time period,” they added.
“Specifically, Australia’s imports of jet gas/kerosene is ready to surge, given the shortage of means to ramp up home manufacturing,” the analysts continued.
Australia’s two remaining refineries are closely geared in the direction of the manufacturing of diesel and gasoline, with jet gas/kerosene manufacturing constituting simply 5 % of home refining output lately, the BMI analysts famous within the report.
“Over the long run, we anticipate Australia’s imports of refined fuels to proceed rising however at a slower tempo, rising to at least one million barrels per day by the tip of our forecast interval, pushed by a bearish outlook for the nation’s home refining output which shall be inadequate to satisfy rising home demand,” the analysts acknowledged within the report.
To contact the writer, e-mail andreas.exarheas@rigzone.com
