Asia’s Oil Imports Hit Record High Despite Drop In Chinese Demand

Crude oil imports into Asia hit an all-time high in January, rising by 11% from December, despite lower arrivals into China, data from Refinitiv Oil Research cited by Reuters showed on Thursday.

Asia's total crude oil imports jumped by 11.1% month over month to 29.13 million barrels per day (bpd) in January. The imports last month beat the previous record from November, when Asia imported 29.10 million bpd of crude oil, according to the data.  

Crude oil imports in China, the world's top crude importer, are estimated to have fallen to 10.98 million bpd last month, from 11.37 million bpd in December and 11.42 million bpd in November, the data showed. Part of the decline in Chinese imports was likely due to the Lunar New Year holiday, which fell on January 22 this year, Reuters's Asia Commodities and Energy Columnist Clyde Russell noted.

Crude imports in India, the world's third-largest and the region's second-largest importer, jumped to an all-time high of 5.29 million bpd in January, compared to 4.78 million bpd in December. South Korea and Singapore also boosted crude oil imports in January compared to a month earlier.

Going forward, China will be the wild card in Asian crude imports and international oil markets, analysts say.

China's oil demand could soon rebound as the country reopens from Covid after nearly three years. Authorities have issued a massive batch of allowances for independent refiners to import crude oil. China's reopening is expected to drive fuel demand growth after the initial exit Covid wave wanes at some point later this quarter.

Global oil demand is set to rise by 1.9 million bpd in 2023, to a record 101.7 million bpd, with nearly half the gain coming from China following the lifting of its Covid restrictions, the International Energy Agency (IEA) said in its Oil Market Report for January. 

"China will drive nearly half this global demand growth even as the shape and speed of its reopening remains uncertain," the agency noted.   

By Charles Kennedy for Oilprice.com

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