Saudi Arabia Beats Russia, Becomes Top Supplier of Crude Oil to China in February

Tuesday, 26 March, 2019 - 14:30
London- Asharq Al-Awsat

Saudi Arabia was China’s biggest crude oil supplier in February, data from the general administration of Chinese customs showed on Monday, reclaiming the crown from Russia after ranking second in January.

After having been China’s second-biggest crude supplier for three straight years on an annual basis, the Kingdom is ramping up sales to China via supply deals with refiners outside the national oil companies in a new marketing strategy.

Supplies from Saudi Arabia, the world’s top oil exporter, reached 5.95 million tonnes, or about 1.552 million barrels per day (bpd), the data showed. That was up 29 percent from February 2018, according to Reuters calculations based on customs data.

That compared to supplies from Russia last month of 5.74 million tons, or nearly 1.5 million bpd.

The surge in imports came as the OPEC kingpin producer boosted its share of the Asia market, signing new 2019 term supply contracts with Chinese refiners including Sinochem-Hengli and Rongsheng among others, said Mark Tay, senior analyst for crude oil with Thomson Reuters Supply Chain and Commodities Research, in a note.

Iranian imports rose 7.4 percent to 1.955 million tonnes or 509,700 bpd ahead of a decision due around early May on whether Washington will extend sanctions waivers on Iranian crude.

Shipments from Venezuela were 2.033 million tonnes, or 530,150 bpd, nearly doubling their year-earlier level and up from 1.74 million tonnes in January.

The high Venezuelan shipment is evidence that Chinese refiners had stepped up purchases ahead of anticipated tightening in US sanctions on the south American exporter.

Meanwhile, imports from the United States skidded to just 22,380 bpd, fully 91 percent below their year-earlier level, amid uncertainty over ongoing US-China trade talks.

China also bought some 67,000 tons of liquefied natural gas (LNG) from the United States in February. Shipments of LNG have become sporadic since China slapped a 10 percent tariff on imports of American gas last September.

On the other hand, oil prices slipped on Monday with concerns of a sharp economic slowdown outweighing supply disruptions from OPEC’s production cutbacks and from US sanctions on Iran and Venezuela.

Read More ...