Last Sunday, customs data showed that crude oil imports to China from Saudi Arabia significantly fell in 2019, while those from Russia increased. To remedy the lack of supply, China opted for more crude oil imports from Malaysia this year.
Crude oil imports from Malaysia to China amounted to 1.054 million tons. The yield showed a significant increase of 107 percent compared to values from 2019. China's crude oil imports this March experienced a total increase of 4.5 percent on an annual basis to 9.68 million barrels per day.
Customs data showed that refiners stock up on cheaper cargoes to remedy the significant fall of domestic fuel demand and drop in refining rates caused by pandemic issues. Shipments of crude oil from Saudi Arabia were then revealed to be only 7.21 million tons or 1.7 million BPD, according to data from the General Administration of Customs.
The yield from Saudi Arabia fell from 1.73 million BPD on an annual basis during 2019, with an average daily import of 1.79 million BPD during the first two months of this year. Hence, crude oil imports from China's top supplier Saudi Arabia fell by 1.6 percent compared to values in 2019. On the other hand, purchases from China's top two suppliers, Russia increased by 31 percent.
Last month, Russia supplied 7.02 million tons to China or 1.66 million BPD. The yield was 1.71 million BPD down for the first two months of this year. The cause of the decline was blamed on state refiner's deep production cuts in March. The cuts were imposed to reduce their fuel stocks in March.
Independent plants, on the other hand, increased their run rates as oil prices dropped due to the Saudi and Russian pledges to increase the supply of crude oil. The said pledges were said to have boosted refining margins for the crude oil market.
Members of the Organization of the Petroleum Exporting Countries (Opec), including Saudi Arabia and other producers, agreed to impose output cuts. The said cuts helped lift oil prices from reaching all-time lows. However, some claimed that deeper reductions are needed to effectuate significant changes to the market.
On the other hand, China's imports of crude oil from the United States remained closed to zero. March data showed that supply has been falling since 2019 due to the China-US trade deal. However, The Star reported that the crude oil imports from the US are expected to improve by 2020 after Beijing granted tariff waivers on US goods, including crude oil.
