UK DATA: Crude production slumps to 8-year low

Quantum Commodity Intelligence - UK crude production slumped to its lowest since 2014 by the end of June, as refinery throughputs and product output slowed, monthly BEIS data showed.

Crude production dropped to an eight-year low of just under 2.8 million mt, down 12% from the previous year and 9% lower than May, and the lowest recorded production figure for June since records began in 1995.

The UK regularly produced over 10 million mt/month of crude until the 2000s.

It is a blow to the UK's ambition to be more energy self-sufficient following the war in Ukraine. The country imported no Russian crude oil and diesel in June for the first time in 25 years, according to data from the ONS yesterday.

It contributed to a slowdown in total crude imports, which fell 16% from May to 3.13 million mt.

Crude production dropped as refinery activity also slowed. UK throughputs retracted 15% from May to 4.17 million mt, or 3% below June 2021.

Oil product output subsequently dropped 17% on the month to 3.86 million mt, down 4% from a year earlier.

There was industrial action at ExxonMobil's 260,000 bpd refinery at Fawley in June that ended in a pay rise for workers. Staff walked out at Petroineos' 150,000 bpd Grangemouth refinery earlier this month in a dispute over pay.

The UK increased imports and slowed exports to make up the shortfall. Refined product imports fell 14% from May to 2.48 million mt, with exports falling by the same amount to 1.65 million mt.

Product stocks were also drawn down. Gasoline, jet and fuel oil stocks fell on the month, while diesel inventories ticked up 4% from eight-year lows in May to 1.6mn t.

UK inventories remain firmly below their historical average. Total UK product stocks stood at 4.73 million mt at the end of June, down 10% from a year earlier and 12% below the pre-Covid five-year average (2015-2019) for June.

Crude stocks were 40% below their five-year average before the pandemic at 4.56 million mt and 12% lower than a year earlier.

For a full round-up of UK production data, visit Quantum's Data Dashboard.