Main Driving Factors for the Market Demand of Graphitized Petroleum Coke
1. Explosive Demand in the New Energy Sector
Core raw material for lithium battery anode materials: Low-sulfur petroleum coke, with a sulfur content of less than 0.5%, does not cause volume expansion during the graphitization process, making it a key raw material for lithium-ion battery anode materials. In 2024, global demand for lithium battery anode materials reached 2.2 million tons, corresponding to a demand for over 3 million tons of petroleum coke. However, the actual supply was only 2.6 million tons, resulting in a 13% supply gap. With the rapid growth of the electric vehicle market (global electric vehicle sales are expected to reach 30 million units by 2026), the demand for lithium battery anodes for petroleum coke will continue to rise, driving up prices for high-end petroleum coke (such as low-sulfur coke).
Surging demand in the photovoltaic industry: In 2024, global demand for photovoltaic-grade petroleum coke surged by 35%, with silicon material companies (such as Tongwei and GCL-Poly) competing for low-sulfur coke resources, further pushing up prices.
2. Stable Demand in Traditional Industrial Sectors
Aluminum electrolysis industry: Petroleum coke is the primary raw material for pre-baked anodes in aluminum electrolysis production, used to improve electrolysis efficiency. Although demand in the aluminum electrolysis industry has been affected by aluminum price corrections, long-term demand remains stable.
Steel industry: Petroleum coke is widely used as a carbon additive and raw material for graphite electrodes in electric arc furnace steelmaking. With China’s plan to increase the proportion of electric arc furnace steel to 15%-20% by 2025, demand for petroleum coke will further grow.
Fuel sector: Petroleum coke, with its high calorific value, is commonly used as a fuel in industries such as glass factories, power plants, and cement plants. Although low-cost coal has substituted some demand for high-sulfur fuel coke, low-sulfur coke remains competitive in the high-end fuel market.
3. Tight Supply
Reduction in refining capacity: Under global “dual carbon” policies, European and American refineries have accelerated the phase-out of outdated capacity. In 2024, European refining capacity decreased by 8% year-on-year, while the shutdown rate of U.S. shale oil refineries reached 12%, leading to a sharp decline in the supply of low-sulfur petroleum coke.
Limited domestic production: Affected by the shutdown and maintenance of some delayed coking units and a decline in operating rates, domestic petroleum coke production has declined since 2025. Although the advancement of refining-chemical integration projects will drive production growth, the short-term supply tightness is difficult to alleviate.
Insufficient import replenishment: Overseas production of low-sulfur coke is limited, and the escalation of U.S. export restrictions on graphite to China has forced Chinese anode companies to shift to domestic petroleum coke, further exacerbating domestic demand pressures.
4. Policy and Market Dynamics
Stricter environmental policies: Companies are required to invest more funds in upgrading equipment to meet environmental requirements, indirectly driving up production costs. For example, in early 2025, environmental production restrictions in Hebei and Henan provinces led to supply constraints.
Impact of trade barriers: The escalation of U.S. export restrictions on graphite to China has increased raw material procurement costs for Chinese anode companies, driving up petroleum coke prices.
Inventory speculation: Traders have accumulated inventories to historic peaks, with domestic port inventories dropping from 2 million tons in 2023 to 800,000 tons, artificially creating a “false shortage” and further pushing up prices.
5. Cost Transmission and Substitution Effects
Crude oil price fluctuations: The correlation between petroleum coke prices and crude oil prices is approximately 0.8. In 2024, international oil prices surged above 120perbarrel,compressingrefiningmarginsandleadingtoproductioncutsbyrefineries,furtherexacerbatingtheshortageofpetroleumcoke.AlthoughBrentcrudeoilpricesareexpectedtofallto51 per barrel by 2026, short-term cost support remains strong.
Technological substitution pressure: The mass production of Tesla’s 4680 battery silicon-carbon anodes, which improve energy density by 20%, may accelerate the substitution process if petroleum coke prices remain high. However, the commercialization of silicon-based anodes still requires 3-5 years, so the short-term impact on petroleum coke demand is limited.
Post time: Sep-30-2025