China’s Crude Imports Climb as Refiners Emerge From Maintenance

Chinese refiners stepped up overseas crude purchases slightly last month from May as some processors emerged from seasonal maintenance.

Oil imports totaled 40.135 million tons in June, according to General Administration of Customs figures released on Tuesday. That’s equivalent to 9.81 million barrels a day, 1.3% higher than May, but was lower than April’s 9.86 million barrels a day, according to Bloomberg calculations.

Local processors may have increased imports slightly in June as some of them ended seasonal maintenance, which peaked during April and May, Yuntao Liu, an analyst at London-based Energy Aspects, said ahead of the data. He expects imports to climb again July as more plants return from so-called turnarounds.

Operating rates for Shandong-based independent refiners averaged 71.02% in June, 4.45 percentage points higher than May, according to JLC. Four of the refiners, known as teapots, restarted units between May 31 and June 6.

Though higher on a barrel-a-day basis, imports were the lowest on a monthly basis since December as a crackdown on teapots’ purchasing, including non-compliant supplies from state refiners to independents, hurt demand, according to Sengyick Tee, an analyst at Beijng-based SIA Energy.

Meanwhile, China’s net fuel exports expanded 40% in June to 4.31 million tons, a surprise given a drop had been expected after officials delayed the issuance of a second batch of fuel quotas. The rise may be because the export margin for gasoline turned positive, according to Li Chunyan, an analyst at OilChem.

©2021 Bloomberg L.P.

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