Japan's gasoline imports seen rising through August as refinery outages cut output

Cosmo Energy Holdings Co

05/08/2024 05:06

NEW DELHI/TOKYO, Aug 5 (Reuters) - Japan's gasoline
imports are expected to stay elevated through August after
rising 20% in June as outages at its refineries are reducing
output during peak summer demand season, traders and analysts
said.
    Import demand from Japan will further tighten supplies in
Asia and support refiners' gasoline margins which have rebounded
to two-month highs earlier in July.  GL92-SIN-CRK 
    Japan's gasoline imports in June rose to 476,630 kilolitres,
up 20.4% from the previous month, data from the Ministry of
Economy, Trade and Industry (METI) showed on Wednesday.
    This is equivalent to 99,930 barrels per day, up 24.5% from
May, according to Reuters calculation. Japan's gasoline imports
averaged at 55,168 bpd in 2023, according to Reuters
calculations based on METI data.
    "We expect Japan to import over 120,000-130,000 barrels per
day of gasoline in July and August. This is mainly driven by a
combination of planned maintenance and recent outages," Wood
Mackenzie analyst Priti Mehta said.
    A Singapore-based trader said higher imports from Japan due
to unplanned outages will cause a decline in Asia's overall
gasoline supply. 
    Cosmo Energy Holdings  5021.T  said it plans to increase
gasoline imports for July-August from the same period last year
but it didn't provide figures.
    Rystad analyst Rohit Raveendran said the significant rise in
imports is driven by a forecasted drop in refinery runs to about
1.9 million bpd in June, which could fall further to 1.7 million
bpd in the coming months due to unplanned shutdowns and ongoing
maintenance.
    Japan's average weekly refinery utilisation rate fell to
63.6% in the week to July 27 from 66.2% in the prior week, data
from the Petroleum Association of Japan (PAJ) showed.
    PAJ said the imports could be rising due to maintenances and
outages at plants owned by top oil refiner Eneos Holdings
 5020.T  and Cosmo Oil during peak summer demand.  REF/OUT 
    Eneos declined to comment. 
    While there could be an increase in gasoline demand in a
particular summer month, overall consumption is expected to
decline by 2-3% annually through the fiscal year of 2028, PAJ
said, citing a recent METI's forecast.
    According to METI prediction issued in April, gasoline
demand is expected to continue falling due to a shift to next-
generation vehicles such as hybrid cars and improved fuel
efficiency of gasoline cars.    

 (Reporting by Mohi Narayan in New Delhi, Katya Golubkova and
Yuka Obayashi in Tokyo; Editing by Florence Tan and Michael
Perry)
 ((Mohi.Narayan@thomsonreuters.com; https://twitter.com/_mohi_;))