Coronavirus Effect In China Hits Oil

Oil refineries in China are cutting production further due to weakening production and declining employee numbers due to coronavirus, processing 25 percent less oil compared with last year. Senior executives and analysts at China's leading refineries noted that the crude oil processing rate this week dipped to around 10 million barrels per day, the lowest level since 2014. Refineries were producing 11.4 million barrels of oil daily earlier this month and an average of 13 million barrels per day last year. The drop in the daily rate of oil processing has dampened optimism that the effects of the virus outbreak may now have peaked. That optimism had supported last week's strong rise in oil prices. Many people in China are trapped in their homes and unable to go to work. In addition, travel bans and concerns are leading to reduced demand for fuel used in transportation.