• 5 minutes Desperate Call or... Erdogan Says Turkey Will Boycott U.S. Electronics
  • 11 minutes Don't Expect Too Much: Despite a Soaring Economy, America's Annual Pay Increase Isn't Budging
  • 15 minutes WTI @ 67.50, charts show $62.50 next
  • 10 hours The EU Loses The Principles On Which It Was Built
  • 2 hours Starvation, horror in Venezuela
  • 4 hours Saudi Fund Wants to Take Tesla Private?
  • 19 hours Crude Price going to $62.50
  • 6 hours Why hydrogen economics does not work
  • 2 hours Tesla Faces 3 Lawsuits Over “Funding Secured” Tweet
  • 3 hours Again Google: Brazil May Probe Google Over Its Cell Phone System
  • 15 hours WSJ *still* refuses to acknowledge U.S. Shale Oil industry's horrible economics and debts
  • 1 day Chinese EV Startup Nio Files for $1.8 billion IPO
  • 1 day Anyone Worried About the Lira Dragging EVERYTHING Else Down?
  • 1 day < sigh > $90 Oil Is A Very Real Possibility
  • 8 hours California Solar Mandate Based on False Facts
  • 15 hours Saudi Arabia Cuts Diplomatic Ties with Canada
Iran’s Latest Tactic To Save Market Share

Iran’s Latest Tactic To Save Market Share

Iran cut oil prices for…

The Real Leader In Global Energy Production

The Real Leader In Global Energy Production

Last week President Trump was…

BP Finally Unloads Crude Cargo For Chinese Teapot After Months In Port

Oil tanker

A 2-million-barrel crude oil cargo for an independent Chinese refiner in Shandong has finally been fully unloaded after two months spent at the port of Qingdao, Reuters reports, adding that while some of the oil was unloaded back in May when the Mercury Hope supertanker arrived at Qingdao, the remainder stayed in the tanker because of a slowdown in demand from the teapot refiners in the region.

The Mercury Hope was only one of four BP supertankers that had to sit idle in Chinese waters recently, waiting for more favorable demand conditions to offload their cargo. Two of the cargos were bought by one of the largest independent refiners in China, Qingyuan Group.

Qingyuan Group has a 104,000-bpd refinery in Shandong, the heartland of the Chinese teapot industry, and is the largest independent Chinese lubricants producer. Beijing has provided the company with a crude oil import quota of 4.04 million tonnes for both 2017 and 2018. Still, the fact that even with such a large quota, the company waited before it bought BP’s cargo suggests that teapot demand, which was the main driver of the surge in Chinese crude oil imports over the last two years, is slacking off.

Related: Houthis Prepared To Halt Oil Tanker Attacks

There is more than one reason for this slowdown in demand. Bloomberg reported earlier this week that the independent Chinese refiners are suffering the combined effects of a tax regime overhaul, higher oil prices, and a lower yuan, plus banks tightening their credit policy. One independent refiner already filed for bankruptcy because of the credit crunch and more might follow as they slip into the red under the combined weight of these factors.

The news should be worrying for oil exporters that rely on China as their main client. Pressured by banks and taxmen, the teapots are buying less crude. Yet some local analysts believe this could change in the current quarter as several large refineries are scheduled to start operation.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News