Nippon Oil to Halt Operations Due to Sluggish Demand

Nippon Oil Corp said on Tuesday it aims to halt operations of its 420,000 tonnes per year paraxylene production unit at its Oita refinery by the end of the month due to negative margins and sluggish demand for petrochemicals.

It would be the second shutdown of a paraxylene unit at Japan's top oil refiner this month, and comes on the heels of negative petrochemical margins.

On Monday, Nippon Oil shut a 720 tonnes-per-day Mizushima paraxylene unit on Monday, in line with the shutdown of a 110,000 barrels-per-day Mizushima crude distillation unit due to the accelerating decline in oil demand in the world's third-biggest oil consumer.

Many Japanese refiners and petrochemical firms have curbed their plants' usage rates since earlier this year as the global economic slowdown cooled industry activity, which hit oil and petrochemical demand.

Author: Jo Amey