China Oil Refining Market Overview, 2030

China’s oil refining industry is the largest in Asia, supported by a vast network of refineries clustered primarily in key regions such as Shandong, Guangdong, and Liaoning provinces. The sector is dominated by major national oil companies including Sinopec, PetroChina, and CNOOC, alongside a significant presence of independent refiners known locally as “teapots.” Over the years, China has developed highly integrated refining and petrochemical complexes, which enhance the value chain by producing both fuels and chemical feedstocks from crude oil. The industry’s evolution has been closely tied to China’s rapid economic growth, urbanization, and rising energy demand. Refining capacity has expanded steadily to meet domestic consumption needs while supporting export markets. China’s refining sector operates under centralized government policies aimed at energy security, environmental compliance, and modernization. These policies guide investments in upgrading refinery technologies, reducing emissions, and promoting cleaner fuels. The country has also experienced geopolitical influences such as global supply chain disruptions and OPEC+ production changes, which affect crude sourcing and pricing. Energy transition pressures are increasingly important, as China seeks to balance continued hydrocarbon use with commitments to carbon neutrality by 2060. Decarbonization challenges prompt investments in renewable fuels and digital refinery upgrades. China’s National Development and Reform Commission (NDRC) has announced that it will cap the country’s crude oil refining capacity at 1,000 Mt/year (20 mbl/d) by 2025, in order to modernise its oil processing sector and limit CO2 emissions. In addition, the NDRC has stated that it would promote the upgrading and optimisation of existing refineries, accelerate the closure of small and outdated facilities, and limit new refinery capacities.

According to the research report ""China Oil Refining Market Overview, 2030,"" published by Bonafide Research, the China Oil Refining market is anticipated to grow at more than 4.82% CAGR from 2025 to 2030. Strategic fuel reserves bolster energy security, while government incentives encourage refining-petrochemical integration to maximize resource efficiency and economic value. Refinery upgrade and expansion projects are actively underway, focusing on improving product quality and environmental performance in line with international standards such as IMO 2020 sulfur limits and Euro VI emission norms. According to the NDRC, refineries with a capacity of 10 Mt/year or more will account for 55% of China’s processing facilities by 2025 and every new refinery will have to have a capacity of at least 10 Mt/year. Smaller and non-conform older refineries (of 2 Mt/year or less) will be closed. The NDRC will also promote energy efficiency and better carbon emission management in the refining industry by auditing facilities to look at production capacities, crude oil sources and efficiency levels. In addition, the commission will build a national information database on the sector. Refining margins and crack spreads fluctuate with global crude oil price volatility, affecting profitability. Opportunities are emerging in hybrid operations that blend traditional refining with biofuel production and advanced digital technologies for operational optimization. In February 2024, in Weifang, Shandong Province, China, the world’s largest white oil hydro-processing unit for Hongrun Petrochemical Co., Ltd. was launched by Chevron Lummus Global LLC (CLG). White oil is a highly refined mineral oil that is used in a broad range of applications, including industrial lubricants, food processing, cosmetics, and pharmaceuticals. Environmental, Social, and Governance (ESG) compliance remains a significant challenge due to feedstock price instability and the need for large capital investments to meet emission reduction targets.

China’s gasoline consumption is largely driven by private vehicles across Tier 1 to Tier 3 cities, where rapid urbanization and increasing vehicle ownership continue to push demand. Despite government efforts to promote electric vehicles, gasoline remains essential in daily urban mobility and suburban transport. Diesel maintains a strong presence in industrial applications, logistics, and heavy-duty transportation sectors such as freight and construction. The diesel market also supports agricultural machinery and off-road equipment. Jet fuel demand in China has rebounded sharply due to the rapid recovery of domestic and international air travel, with major airports like Beijing Capital, Shanghai Pudong, and Guangzhou Baiyun acting as critical hubs. Fuel oil consumption is steadily being phased down as stricter environmental policies enforce lower sulfur content and carbon emissions, particularly in power generation and industrial uses, aligning with China’s clean air initiatives. Asphalt demand remains consistent, fueled by extensive infrastructure programs including highway expansions, urban road construction, and major public works projects. LPG continues to be a vital fuel source for cooking and heating in rural and urban households, especially in inland provinces where pipeline natural gas access is limited. Recent policy pushes to improve fuel quality have accelerated upgrades in refining outputs, particularly to meet GB-VI vehicle emissions standards and IMO 2020 sulfur limits for marine fuels. Overall, China’s fuel type consumption reflects a mix of growing transport demands, industrial uses, and increasing environmental compliance.

The transportation sector dominates refined fuel consumption in China, encompassing passenger vehicles, commercial trucks, and public transit systems, with growth sustained by increasing urbanization and freight logistics. Aviation fuel demand has rebounded strongly following COVID-19 disruptions, supported by expansion of domestic and international flight routes connecting major metropolitan hubs such as Shanghai, Beijing, and Shenzhen. Marine bunkering is significant at major coastal ports including Shanghai, Ningbo, and Qingdao, where China’s growing maritime trade and shipping industry drive demand for compliant low-sulfur bunker fuels. The petrochemical industry is a key consumer of refinery outputs, particularly naphtha, which serves as feedstock for producing plastics, synthetic fibers, and chemicals at integrated complexes in regions like Zhejiang and Guangdong. Residential LPG use remains widespread across inland provinces and rural areas, where it supports cooking and heating needs in the absence of widespread natural gas infrastructure. Electricity generation from refined fuels is limited but still present in some remote or industrial areas relying on fuel oil or diesel generators. Recent government policies emphasize cleaner fuel standards, pushing refiners to produce higher quality fuels aligned with China’s carbon neutrality goals. Investment in fuel efficiency and pollution control technologies in transportation and industrial sectors is expanding in response to tightening environmental regulations.

China’s refining sector is primarily dependent on imported crude oil, with major supply partners including Russia, Saudi Arabia, Iraq, Brazil, and Angola. This import-heavy model stems from limited domestic crude reserves relative to China’s vast refining capacity and energy demands. Over the past decade, geopolitical disruptions and shifting oil markets have pushed China to diversify its crude sourcing strategy. This includes long-term contracts with Middle Eastern suppliers, increased inflows from West Africa, and strengthened pipeline imports from Russia. China's state-owned refiners like Sinopec and PetroChina manage strategic reserves and operate integrated port and inland logistics to maintain feedstock continuity. In response to environmental targets and energy security needs, some inland refineries have piloted coal-to-liquid (CTL) and gas-to-liquid (GTL) technologies to utilize China's large domestic coal and gas reserves, although these remain limited due to high carbon intensity and water requirements. Biomass and bio-based feedstock use is in early development, with coastal green refinery pilots exploring renewable diesel and sustainable aviation fuel production. Natural Gas Liquids (NGLs) are processed at select complexes, but remain a smaller share of total feedstock input. Refiners increasingly upgrade flexibility to handle sour and heavier crude slates through improved distillation, hydrotreating, and desulfurization units. These feedstock strategies aim to reduce import risks, improve processing economics, and align with China’s dual goals of supply security and environmental compliance.

China’s refining landscape has evolved from a dominance of basic hydro-skimming facilities to a modern mix that includes some of the world’s largest and most advanced deep conversion complexes. Historically, early refineries especially in inland provinces like Henan and Sichuan relied on topping and hydro-skimming configurations, with limited capability for upgrading heavy fractions. These facilities produced a high share of residual fuel and low-value products, and many have since been closed, consolidated, or upgraded due to tightening fuel quality regulations and environmental mandates. Mid-level conversion refineries remain operational in smaller cities, fitted with catalytic reformers and basic FCC units to improve gasoline yields. However, the major shift has been toward deep conversion refineries, especially along China’s eastern and southern coasts. Massive facilities like Hengli Petrochemical in Dalian and Zhejiang Petrochemical in Zhoushan operate at high Nelson Complexity Index levels (above 10), integrating hydrocracking, FCC, delayed coking, alkylation, and desulfurization units. These refineries are built not only to process imported heavy-sour crudes but also to feed adjacent petrochemical complexes, enhancing overall value addition. State-owned giants like Sinopec and PetroChina continue upgrading older plants such as in Guangzhou and Nanjing by adding residue upgrading units, hydrogen recovery systems, and energy-efficient furnaces. As part of China’s green transition, many refineries are testing co-processing systems that blend bio-oils, waste feedstocks, and renewable hydrogen into conventional streams. A small number of specialized hybrid facilities also explore coal-to-liquid (CTL) and gas-to-liquid (GTL) operations, classified under Others, with Sasac-backed Shenhua CTL projects being key examples. This broad complexity profile, ranging from legacy topping units to advanced integrated mega-refineries, reflects China’s dual push for refining self-sufficiency and clean energy alignment within its carbon neutrality framework.

Considered in this report
• Historic Year: 2019
• Base year: 2024
• Estimated year: 2025
• Forecast year: 2030

Aspects covered in this report
• Oil Refining Market with its value and forecast along with its segments
• Various drivers and challenges
• On-going trends and developments
• Top profiled companies
• Strategic recommendation

By Fule Type
• Gasoline
• Diesel/Gasoil
• Jet Fuel
• LPG
• Fuel Oil
• Others (Lubricants, Asphalt)

By Application
• Road Transportation
• Aviation
• Marine Bunker
• Petrochemical Industry
• Residential & Commercial
• Electricity Generation
• Others (Rail & Domestic Waterways, Agriculture)

By Feedstock
• Crude Oil
• Natural Gas Liquids (NGLs)
• Biomass
• Others (Coal Tar, etc.)

By Complexity Type
• Topping
• Hydro-skimming
• Conversion
• Deep Conversion
• Others Show more