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China’s crude oil imports last month were 4.8 percent lower than a year ago, energy analytics provider OilX reported, noting the daily average for September was 9.51 million bpd.
At the same time, refinery run rates increased during the month, reaching 13.7 million bpd, which was 678,000 bpd higher than run rates for August but still 431,000 bpd lower than the run rates in September 2021.
The OilX report comes as Reuters’ Clyde Russell noted an increase in total Asian oil imports last month, most of it coming from China. According to the Refinitiv Oil Research data, China’s oil imports averaged 10.19 million bpd in September, up 650,000 bpd from August. Official Chinese data comes out later this month.
The increase in imports of crude could be taken as a sign of recovering demand in the world’s second-largest oil consumer after the United States. However, the latest reports about China’s Covid situation could be cause for worry. Infections are on the rise in many big cities and while there’s no mention of lockdowns yet, testing has been increased and some public spaces have been closed.
The increase in September oil imports could be seen as good news for Europe, too. Reuters’ Russell pointed out in his column that Chinese refiners are looking to Europe as a market for their fuels after Beijing issued a new fuel export batch amid a deepening diesel crunch in Europe.
The first batch of export quotas for next year, however, is smaller than this year’s first batch, OilX noted in its report. The first batch of 2023 export quotas stands at 20 million barrels, which is as much as 83 percent lower than the first batch for 2022. It was also issued a lot earlier than last year’s, OilX noted.
The latest loading data suggests a further slide in imports this month, the energy analytics firm also pointed out in its report, adding that oil in floating storage in China was also down, to about 4.1 million barrels.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com