Bitumen prices surged significantly after the New Year. According to data monitored by Business Society, the ex-factory price of heavy-duty bitumen #70 in Shandong was 2,940 yuan/ton before the holiday, while the ex-factory price in Shandong on the 6th reached 3,130–3,140 yuan/ton, marking an increase of 6.7%. The core driver of this price hike stems from U.S.-Venezuela relations, as the export of Merey crude oil from Venezuela—a key feedstock heavily relied upon by domestic independent refineries—has been disrupted, leading to feedstock pressure and supply contraction for refineries. In mid-December 2025, the U.S. escalated sanctions against Venezuela, causing disruptions in Merey crude exports, which are unlikely to recover in the short term. In terms of capacity, China’s total bitumen capacity stands at 71.4 million tons, with independent refineries accounting for 59% (41.85 million tons), making them the primary suppliers. In 2025, China imported 22.47 million tons of Merey crude and diluted bitumen, while independent refineries produced 15.558 million tons of bitumen during the same period. The supply of Merey crude directly determines the capacity utilization of independent refineries. On the supply side, Merey crude inventories at independent refineries are only sufficient until February 2026, after which low-cost feedstock will sharply decline. Coupled with weak demand in the first quarter, bitumen production is expected to be 3 million tons, down 15.2% year-on-year. This supply contraction is the core driver of the current price increase, and the simultaneous strengthening of the main bitumen futures contract on the Shanghai Futures Exchange further confirms expectations of supply tightening.

Bitumen yield by crude oil source country, m%:
Merey (Venezuela): 60
Boscan (Venezuela): 72
Napo (Ecuador): 55
Cold Lake (Canada): 45
Ron Cador (Brazil): 43
Castilla Blend (Colombia): 39.5
Arab Heavy (Saudi Arabia): 35
Basrah Heavy (Iraq): 34
Arab Medium (Saudi Arabia): 30
Kuwait (Kuwait): 28

The data show that Venezuelan crude oil has a significantly higher bitumen yield. Although Merey crude is a high-sulfur, extra-heavy variety, its low price and low premiums/discounts, combined with high yield and high added value, make it the optimal choice for independent refineries. Other heavy crude oils have lower yields and higher procurement costs. Currently, Merey crude trades at a discount of -13 USD/barrel, with a price difference of 10 USD/barrel (equivalent to 480 yuan/ton) compared to Canada’s Cold Lake crude. A disruption in Merey supply would increase refinery costs.

From Business Society’s perspective, feedstock tightness and geopolitical premiums support strong bitumen prices, but event-driven fluctuations should be monitored. In the medium to long term, three key variables warrant close attention: U.S. actions toward Venezuela, the recovery of Venezuela’s crude oil production and exports, and domestic refineries’ procurement of alternative feedstocks. Additionally, OPEC+’s decision to pause production increases in the first quarter will support the global crude oil market, indirectly affecting bitumen costs. The evolving situation requires continuous monitoring.