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China registered in April its first annual increase in crude oil imports since January as shipments rebounded on the back of higher arrivals from Russia, analysts say.
Last month, China, the world’s top crude importer, imported 10.51 million barrels per day (bpd) of oil, per data from the Chinese General Administration of Customs calculated by Bloomberg. This was up by 6.6 percent compared to April of last year, and up by 4 percent from March 2022, according to estimates from Bloomberg and Reuters.
The higher Chinese imports in April—when domestic fuel demand was weakening amid tightening COVID-related restrictions in major cities such as Shanghai—could be partially due to more arrivals of crude oil from Russia.
Chinese imports of Russian seaborne crude jumped by 20 percent in April, although it’s not clear if Chinese refiners purchased the cargoes that arrived in April before or after Russia invaded Ukraine on February 24, Vortexa analyst Emma Li told Bloomberg.
After the Russian invasion of Ukraine, smaller independent refiners in China, the so-called teapots, continued to buy Russian crude such as Urals and ESPO, which are now heavily discounted to Dated Brent.
Still, China’s state refiners are not rushing to buy Russian crude on the spot market, avoiding being singled out as buyers of Moscow’s oil amid tightening Western sanctions on Russia. China, which has grown increasingly closer ties with Russia in the energy sector of late, has not officially condemned Vladimir Putin’s war in Ukraine, but its government has recently appeared cautious about new spot deals.
State giant PetroChina, for example, said last week it would not buy up heavily discounted Russian oil and gas, saying it was conducting business with Russia in accordance with “pre-signed contracts”, and, unlike India, it was not looking to take advantage of Russian crude that has been heavily discounted since the Russian invasion of Ukraine.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.