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Japan's leading oil refiner Nippon Oil Corp has said today that it plans to cut refining output by around 6 percent during the month of May, in a move which looks set to have an effect on the production of fuel oil and on the availablity of marine fuels during this period.

The decision to reduce production marks the seventh month of year-on-year declines in succession, reflecting slow domestic demand during the current economic downturn.

Nippon Oil said it is likely to refine around 250,000 kilolitres less crude per day in May compared with the same month last year. The total monthly volume is therefore likely to be approximately 4.17 million kilolitres (845,000 barrels per day), according to calculations made by Reuters.

The May cut also takes into account Nippon Oil's scheduled maintenance on its 180,000 barrels-per-day Muroran refinery for about a month from May 14th.

Next month's projected output is still an improvement on previous months, however. In February, Nippon Oil said that it expected to cut crude refining volumes by around 22 percent in March and in the six months to April the refiner has curbed production by over 10 percent.

As a consequence of the decline in crude refinery runs, the recent drop in fuel oil production has also had an effect on the availability of bunker fuel at Japan's ports. Over the last few weeks, suppliers have found it difficult to meet the bunkering needs of its customers due the limited availability of stock for the marine fuels market.

The decision to also curb production next month, albeit at below 10 percent, is also likely to create some difficulties for bunker suppliers during the month of May.