China oil imports from SA went up to 47% in 2019

On Friday, customs data showed that China’s crude oil imports from its largest supplier Saudi Arabia rose nearly 47% in 2019, and December shipments from the kingdom horizontal to a year earlier.

Shipments to China in 2019 from Saudi Arabia amounted to 83.32 million tons or 1.67 barrels per day. December shipments reached 6.99 tons, according to data from the General Administration of Customs.

Earlier, in 2018, Aramco, the Saudi Arabian Oil Company, signed at least two new supply pacts with private refiners in China, that came into the market from late 2018. As a result, China’s oil imports rose 6% to 336 million tons, or 8mln BPD, compared to last year. In September, oil imports rose to 9.5 million BPD. Previously, Saudi Aramco only dealt with China’s state refiners in long-term contracts.

China’s oil imports from other countries

Russia, China’s No. 2 supplier, exported a record 77.64 million tons in 2019, about 1.55 million BPD, up some 9% from the previous year. Demand from China’s independent refineries for ESPO, Eastern Siberia Pacific Ocean oil pipeline, crude helped to push the number higher.

China import’s from the US, badly hit by the China-United States trade war, were nearly divided in 2019 to 6.35 million tons, with no imports in December.

However, China is expected to increase purchases of US oil in 2020. This is after guaranteeing to buy at least $52.4 billion of US energy products over the next two years as part of the Phase 1 deal to end an extended trade dispute.

Higher Imports of US crude could see importers dial backorders from Brazil and West Africa. In 2019, despite US government pressure to abolish Tehran’s oil exports, China sustained some purchases of Iranian oil. The most significant amount of oil likely going into government stockpiles.

December Arrivals from Iran rose at around 405 thousand tons, and annual volumes summed 14.77 mln tons. As the customs data showed, it is about half of the imports of 2018.

Direct shipments from Venezuela were zero for the third month in a row, as Caracas’s top oil client. China National Petroleum Corp (CNPC), steered clear of lifting any oil from the South American exporter to avoid violating subsequent US sanctions.

Annual imports from Venezuela decreased by nearly a third to 11.39 million tons, the customs data showed.