China’s govt-owned refinery to cut crude processing rates but Nigeria’s plants stay shut

CHINA’S state-owned refining giant Sinopec plans to reduce its refinery processing rates by about 11 percent–13 percent this month as crude supply disruptions linked to the Middle East conflict squeeze feedstock availability, according to a Reuters report on Friday citing sources familiar with the company’s operations.

The refining major, whose facilities represent roughly one-thirds of China’s total refining throughput, is expected to lower crude processing by 600,000 to 700,000 barrels per day (bpd) in March. This adjustment comes from an earlier target of 5.2 million bpd. Sources noted that the reduction is separate from routine refinery maintenance that had already been scheduled before the outbreak of the conflict.

The planned cut is part of China’s wider strategy to safeguard domestic fuel supplies during the ongoing crude supply disruption, Oilprice.com reported. Authorities earlier this week introduced a ban on fuel exports to prioritise local consumption as global supply risks intensify.

Sinopec’s exposure to Middle Eastern crude is significant. Of its 4 million bpd crude imports, about 2.4 million bpd arrive from the region under long-term supply agreements with Saudi Arabia, Iraq, Kuwait, and Qatar, leaving the refinery highly vulnerable to disruptions stemming from the conflict.

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A source familiar with the matter told Reuters that the company has few alternatives but to scale back refinery operations immediately given the constrained crude supply.

At the same time, Sinopec is expected to channel more production toward petrochemicals, ensuring adequate domestic supply while taking advantage of surging refining margins (fuel cracks).

The supply shock could have broader regional consequences. Analysts at Wood Mackenzie previously warned that as much as 6 million bpd of crude processing capacity across Asia could be cut in April under a worst-case scenario if emergency reserves are not deployed. Asian refineries rely on the Middle East for around 65 percent of their crude supply, making them highly exposed to disruptions.

Under a more moderate scenario where emergency stockpiles are used, the consultancy expects China to reduce crude runs by about 750,000 bpd in April, while India could cut refinery utilisation by roughly 8 percent, equivalent to about 400,000 bpd.

Fuel markets worldwide are likely to tighten further as Asian countries scale back exports or impose bans, while refinery shutdowns in the Middle East continue to limit supply.

The International Energy Agency (IEA) said in its latest monthly report that over 3 million bpd of refining capacity in the Middle East has already been taken offline due to attacks and the absence of viable export routes.

According to the agency, refinery activity in other regions may also face constraints as limited feedstock availability makes it increasingly difficult to maintain normal processing levels.

Nigeria-owned refineries remain shut

Economy Post found that all the 4 refineries owned by the Nigerian government are shut down. This was also confirmed by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA)’s State of the Midstream and Downstream Fact Sheet in March, which noted that the Port Harcourt Refinery remained shut in February 2026.

The Kaduna Refinery also remained shut, although 27,000 litres of diesel per day were trucked to the domestic market from existing stock. Similarly, the Warri Refinery remained inactive, with no product evacuation recorded throughout the month.

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In other words, none of the refineries owned by the Nigerian National Petroleum Company Limited (NNPCL) is available to support Nigerian households and firms as petrol prices escalate in Africa’s most populous nation. Brent stood at at $103.1 per barrel at 11.58pm on Friday, with WTI at $98.71.

“We only have Dangote, who, unfortunately, cannot do what Sinopec is doing in China,” said a United Kingdom-based development economist, Ms Edith Smith. “He is a businessman and would not do what a government-owned refinery should so. He is driven by profits, not pity. But I think Nigerians need some sort of help at this point.”