Higher processing rates at Chinese refineries reduced the availability of crude for storage, Reuters’ Clyde Russell has reported, with the average crude surplus last month at just 570,000 barrels daily.
For context, average surplus rates for crude oil have been estimated at close to 1 million barrels daily since the start of the year and 1.01 million barrels daily in August, Russell reported.
Oil imports in September averaged 11.5 million barrels daily, data released earlier this month showed. The number represented a 3.9% increase on the year but a 4.5% decline on the month, and the lowest monthly average since the start of the year.
With higher refinery run rates, the amount available for stockpiling has shrunk, driving down the average surplus rate since the start of the year to 930,000 barrels daily, Russell noted in his report.
China’s crude oil imports got off to a slow start this year but picked up in the spring, to remain robust as the country stocked up on discounted Russian and Iranian crude. China is even building new storage capacity at the moment, to keep stockpiling the commodity, despite forecasts that demand growth is about to peak in a couple of years. Plans are in place for 11 new storage facilities with a combined capacity of 169 million barrels, to be built over the next two years.
China recently struck back against criticism from President Trump about its continued oil trade with Russia, which Washington claims helps prolong the war in Ukraine. Beijing said its trade was “legitimate” and in its turn accused the U.S. of “unilateral intimidation”. Imports of Russian oil, Beijing said, were an example of “normal and legitimate economic, trade and energy cooperation with countries around the world, including Russia.”
Russia is China’s biggest oil supplier, accounting for over 2.1 million barrels in daily flows, per full-year 2024 data. Saudi Arabia is a distant second, at 1.576 million barrels daily, per Visual Capitalist data.
By Irina Slav for Oilprice.com
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