BEIJING: China’s daily crude oil production in October fell to a more than seven-year low , data from the country’s statistics bureau showed on Monday. The development comes as global oil prices are still off from $115/barrel in mid-summer 2014 to now hovering in the mid $40s range amid record high global oil output and historically high oil inventory levels. Prices dipped into the mid-$20s range in January. Low oil prices have forced China’s state-owned oil majors to trim oil exploration and production activities. Also, contributing to the country’s falling oil output are maturing oil fields and aging infrastructure. However, the scenario will likely remain unchanged until oil prices can find a floor and start trending upward again, giving oil companies an incentive to drill for more oil.
China’s October oil production dropped 11.3% from the same period a year ago to 16.05 million tonnes, the country’s statistic bureau reported. However, production for the month is up marginally from 15.98 million tonnes produced in September. On a daily basis, October production was 3.78 million barrels per day (bpd), the lowest since May 2009, and down from 3.89 million bpd in September.
The country’s largest oil producer, PetroChina, reported in October that its crude oil production for the first nine months of 2016 dropped to 696.6 million barrels from 722.9 million a year earlier. China National Offshore Oil Corp. (CNOOC) posted a 7.7% drop in net oil and natural gas production in the third quarter. Even though oil prices climbed into the mid-$50s range last month amid talk that OPEC would reach a 1% oil production cut at its November meeting, the short-term market movement failed to convince China’s oil companies that those price points would last.
