Asian Refiners Cut Output Amid Iran Conflict
Asian refining throughput is expected to drop significantly in April and May as the closure of the Strait of Hormuz forces a shift to lighter crude grades. This transition is projected to reduce regional diesel and jet fuel supplies by at least 1 million barrels per day.
Asian refining throughput is projected to decline sharply through April and May as crude imports reach a decade low. The ongoing conflict involving Iran has forced regional refiners to shift toward processing lighter crude grades, a move that is expected to slash diesel and jet fuel production by at least 1 million barrels per day (bpd).
As the region responsible for 37% of global refining output, Asia typically relies on the Middle East for two-thirds of its crude supply. The closure of the Strait of Hormuz has severely disrupted these flows, leading to significant run cuts and keeping fuel prices elevated. Provisional data indicates that crude imports to the region are set to drop 22% annually to 20.4 million bpd in April, the lowest level since 2016. This decline persists even as some refiners continue to source oil from Russia or pay high premiums for non-Middle Eastern alternatives.
