China’s crude oil imports have fallen in recent months from their record high of nearly 13 million barrels per day (bpd) in June, although imports continue to be considerably higher compared to last year’s monthly levels, data from the Joint Organisations Data Initiative (JODI) showed on Wednesday.
Having hit an all-time high in June, Chinese crude oil imports have declined over two consecutive months by 1.77 million bpd to 11.21 million bpd in August, according to JODI data.
In September, China’s crude oil imports rose from August by 2.1 percent to 11.8 million, official data showed last month, as congestion at Chinese ports started to ease.
China’s crude oil buying binge earlier this year resulted in record-high crude imports and weeks of delays at Chinese ports during which tankers had to wait to discharge the crude oil that refiners had snapped up in the spring when they took advantage of the lowest crude oil prices in nearly two decades.
Going forward, analysts expect that Chinese imports will not be as strong in the fourth quarter, as storage space fills up and demand for fuels in the regions it exports them to remains weak. In the final quarter of the year, Chinese crude oil imports could shed 14.5 percent from the third-quarter levels, equal to 1.7 million bpd, Reuters reported in October, citing IHS Markit associate director Shi Fenglei.
The world’s largest oil importer, China, will continue to have a significant impact on the oil market in the coming months, as most of the rest of the world continues to battle a second coronavirus wave that has stalled the already fragile global oil demand recovery. With the last of the delayed cargoes likely to discharge and clear customs in October, the market now looks with apprehension at signs about China’s oil-importing policies for the rest of the year, seeking signs of how much the ‘normal levels’ of crude imports could be.
By Tsvetana Paraskova for Oilprice.com
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It is natural for China’s initial record-breaking crude oil imports immediately after exiting the lockdown to slow down a bit. After it has bought its needs and filled its storage, China has no alternative but to reduce the level of its imports.
Even the reduced levels of imports are still more than 12% higher than their equivalent in 2019 despite the COVID-19 pandemic.
Dr Mamdouh G Salameh
International Oil Economist
Visiting Professor of Energy Economics at ESCP Europe Business School, London