September crude imports fall 5% on month to 10.03 mil b/d
China’s crude oil imports fell 4.7% on the month to 10.03 million b/d in September, latest data from the General Administration of Customs, or GAC, showed Oct. 13.
The reduction indicated weak momentum for imports for the rest of the year, analysts said.
The country’s crude imports have been under pressure due to destocking activity and limited import quotas, which recovered to 10.53 million b/d in August. This was the first time since April that imports had crossed the 10 million b/d mark.
Data intelligence firm Kpler showed that China’s crude inventory fell 2.1% from August to 847.32 million barrels in September, indicating that destocking had continued amid rising crude markers.
It is more likely that state-run oil companies had contributed most to the decline both in the country’s crude imports and inventory in September by drawing down their crude stocks, because S&P Global Platts’ data showed that China’s independent refineries had increased their crude imports by 13.7% to 12.19 million mt, or 2.98 million b/d, from an 18-month low in August.
With the increase in imports and stable throughput in September, feedstock inventory at major ports in Shandong rose 11.6% on the month to 7.57 million mt as of Sept. 31, data from local information provider JLC showed.
The GAC releases data in metric tons, which S&P Global Platts converts to barrels using a 7.33 conversion factor.
On a metric tons basis, volume fell 7.8% on the month and 15.3% on the year to 41.05 million mt in September.
This led imports in the first three quarters to decline 6.8% on the year to 10.4 million b/d, or 387.4 million mt, the GAC data showed.
Oil product exports rise 11% on month
Meanwhile, oil product outflows in September rose 10.8% to 4.14 million mt from the 13-month low of 3.73 million mt in August due to the allocation of new export quotas, the data showed.
Beijing, in mid-August, allocated 7.5 million mt of oil product export quotas, allowing oil companies to ship more barrels overseas.
As a result, China’s product outflows rose 8.3% year on year to 48.94 million mt in the first nine months.
However, market sources expect China to suspend exporting gasoline and gasoil in November and December following a month-on-month reduction of about 30% in October due to tight supply in the domestic market, while export quotas are running out.
“Gasoline and gasoil demand is not bad in the domestic market, especially gasoil. But supplies are tight as power rationing and delayed crude import quota allocation cap China’s throughput,” a Beijing-based analyst said.
Moreover, it is more and more unlikely that Beijing would allocate additional quotas for the remainder of the year, leaving oil companies with little choice, but to save quotas for exporting jet fuel, demand of which is bad in China, sources said.
This means only 5.87 million mt, or 1.47 million mt/month, of oil product export quotas are available for September-December, compared with 31.13 million mt, or 3.89 million mt/month, in January-August.
The GAC will release data on September gasoline, gasoil and jet fuel exports Oct. 18.
Oil products imports fell 24.2% to 2.22 million mt in September, from a 14-month high of 2.93 million mt in August, the GAC data showed.
This led to China’s net oil product exports rising 138.3% on the month to 1.92 million mt in September.