Idemitsu plans 15% quarterly cut in oil processing as demand wanes

Idemitsu Kosan Co., Japan's second-largest oil refiner, said Friday it plans to cut crude oil processing by 15 percent in the quarter ending Dec. 31 as demand for gasoline and other petroleum products declines.

The company will process 7.4 million kiloliters, or 46.5 million barrels, of crude in the three-month period, compared with 8.7 million kiloliters a year earlier, the Tokyo-based refiner said in a statement. The cut is deeper than the 14 percent reduction for the quarter the company proposed in September.

Idemitsu joins other Japanese refiners, including Nippon Oil Corp., in reducing output on declining demand for gasoline and other fuels. Gasoline sales in August, the peak driving season, dropped by the most for the month since 1953 as high prices prompted motorists to reduce purchases.

The refiner processed 2.27 million kiloliters of oil in October, 19 percent down from last year. It will process 2.24 million kiloliters this month, down 23 percent, and 2.89 million kiloliters in December, down 4 percent, said spokeswoman Maki Yusunaga.

Idemitsu will lower wholesale fuel prices in the week starting Dec. 1, it said in the statement. Gasoline prices will be cut by ¥3.6 a liter and kerosene will be reduced by ¥1.5 a liter.

Crude imports fall

Crude oil imports in October fell 7.7 percent from a year earlier to 118.94 million barrels, with Saudi Arabia reclaiming the top supplier spot from the United Arab Emirates, the energy agency said Friday.

Imports from the Middle East accounted for 87.2 percent of the total, down 0.3 percentage point from a year before for the second straight monthly contraction.

Saudi Arabia's exports to Japan grew 4.6 percent to 37.99 million barrels, followed by 26.61 million barrels from the United Arab Emirates, down 17 percent. In September, the country became the largest supplier for the first time since March 2007.

Iran was the third-largest exporter in October, shipping 16.29 million barrels, up 22.7 percent. Qatar was fourth with exports of 10.06 million barrels, a drop of 35.1 percent.

Imports from fifth-largest Kuwait increased 16.3 percent to 9.62 million barrels.

Domestic sales of petroleum products in October, including gasoline, naphtha and jet fuel, dropped 13.1 percent to 15.89 million kiloliters for the fifth consecutive monthly decrease, the agency said. A kiloliter equals 6.29 barrels.