Key Takeaways
- China’s crude oil imports in August increased by 6.2% from July.
- Refined oil product exports in August surged by 29% month on month.
- China’s natural gas imports in August fell by 12.9% from the same period last year.
China’s crude oil imports in August improved by 6.2% from the previous month, marking the second consecutive month of growth, according to customs data. However, these imports were down 23.4% from the same period last year, reflecting the impact of domestic consumption and export controls.
The easing of export controls on refined oil products since July has contributed to this growth. In August, China exported 6.01 million tons of refined oil products, a 29% increase from July and surpassing the 5.33 million tons exported in August last year.
Despite the increase in oil imports, onshore oil inventories fell by 550,000 barrels per day in August, slowing from a decline of 800,000 barrels per day in July, according to ship-tracking data provider Kpler. Analysts predict that imports will gradually recover after September, but will remain below 8.5 million to 9 million barrels per day.
Emma Li, an analyst at Vortexa, expects at least 3 million tons of transportation fuel exports in September, up 50% from the same period last year. This surge in exports is expected to continue, with at least 3 million tons of transportation fuel exports to destinations other than Hong Kong in September.
In the first eight months, China’s refined oil product exports totalled 34.24 million tons, down 9.6% from the same period last year. Domestic transportation fuel consumption also showed slight improvement, with gasoline demand at 12.6 million tons and diesel demand at 15.48 million tons in August, though both were down 8% and 9% respectively from the previous year.
China’s natural gas imports in August, including LNG and pipeline gas, stood at 10.33 million tons, down 12.9% from the same period last year. Over the first eight months, natural gas imports stood at 78.23 million tons, down 4.4% year on year, indicating a continued trend of reduced imports in the natural gas sector.
Analysts at Kpler, such as Muyu Xu, predict that inventory declines will slow further, suggesting a stabilization in the market. However, the overall trend in oil imports and exports points to a cautious recovery, with domestic consumption and export controls playing significant roles in shaping the market dynamics.
The month-on-month increase in crude imports is in line with the surge in fuel exports in August and continued strong exports in September.
Emma Li, Analyst at Vortexa
