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Chinese crude oil inventories declined by 3.42 percent in August over July, to stand at 29.79 million tons, official Xinhua News Agency reports, in a sign that oil demand growth has picked up.
Last month, total fuel stocks also dropped, by 0.95 percent to 17.02 million tons, their lowest level since December last year, Reuters quoted Xinhua as saying.
The key driver for the drop in oil products stockpiles was a 1.7-percent decline in diesel stocks to 7.33 million tons, in a sign that the domestic glut has been eased. According to Xinhua, demand growth for diesel in the infrastructure, mining, and industrial sectors picked up last month.
China’s gasoline stocks were flat month on month at 7.53 million tons, whereas keronese inventories dropped to 2.28 million tons in August from 2.31 million tons at end-July.
Refinery runs rose in August, after a 10-month low in the previous month.
At 10.71 million bpd, China’s crude refineries saw in July their lowest daily throughput rate since September last year as state firms and independent refineries, both swimming in inventory, continued to duke it out with price as their weapon. China processed in July 500,000 bpd less crude oil than the throughput in June.
According to Xinhua, Chinese crude oil imports in August slowed because some independent refiners, the so-called teapots, shut amid a wave of inspections.
Although China very rarely discloses commercial and/or strategic oil stocks, analysts, industry executives, and international agencies have recently concurred that oil demand growth in China, alongside demand growth in India and in industrialized nations, is pointing to stronger-than-expected oil demand growth currently.
Healthy demand growth for fuel not only in emerging economies led by China and India, but also in Europe, is helping global inventories to draw down faster now, keeping the oil market on the right track towards rebalancing, industry executives said at a conference on Tuesday.
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.