Asian refiners to pare output on poor margins, low demand
* Poor margins, low demand force refiners to reduce runs
* Steepest prediction is for fall to 70 percent of capacity
* Most cite surprise China slowdown as key factor for run cuts
Asian refiners are set to lower operations further in the second half of the year as a slowdown in demand from China slashes profits from processing a barrel of crude into fuels in a market already suffering from sliding consumption in the West.
Paring runs would put further pressure on oil prices, which have already slumped more than a quarter to $98 a barrel on Wednesday since their highs of over $128 in March.
Investors had bet on China to drive oil demand growth as the faltering economic outlook in the West reduces energy usage. But a surprise slowdown in the world's second-largest oil consumer has forced many to temper this expectation.
A Reuters poll of 10 refiners, banks and analysts showed that all forecast a fall in refinery runs in Asia in the second half. The steepest prediction is for operations to slide to an average 70 percent of capacity, with most others expecting them to be around 80 percent from about 85 percent now.
"The economic slowdown has prompted refiners to cut runs in all regions," said David Wech, head of research at JBC Energy in Vienna. "We see Asian refinery utilisation averaging at just above 80 percent in 2012, down by almost 2 percentage points year on year."
A majority of those polled cite the impact a widening debt crisis in Europe is having on China's economy, saying the situation is worse than what most had expected.
China's slowing consumption is barely expected to offset falling demand in developed economies, lowering global oil demand growth to the slowest pace this year since the financial crisis, a separate poll by Reuters last week showed....MORE