China’s West African crude oil loadings are on track to slide to a nine-month low in June as buying in the key outlet wanes after months of voracious importing, a Reuters survey of shipping fixtures and oil traders showed on Thursday.
According to Reuters report, loadings are expected to fall to just over 1 million barrels per day (bpd) in June, some 20 percent below May’s bpd level and
their lowest since September 2016.
China’s independent refiners were expected to slow buying after the breakneck pace of recent months; March exports from West Africa to China of 1.4 million bpd were a record, based on Reuters tracking, and seasonal maintenance and lacklustre local demand had swamped tanks.
Competition to supply China is also fierce, with top producers Russia and Saudi Arabia fighting for market share in the world’s number two oil consumer and Iran also stepping up supply.
“The weaker volumes to China was as expected…though if prices go much lower, you may well see opportunistic buying,”
FGE analyst James Davis said. Still, the bookings were above June 2016 levels of 950,000 bpd, and the month-on-month decline was offset somewhat by a boost in fixtures to India, which at 602,000 bpd hit their highest in more than a year.
Davis said Indian buying was a potential side effect of pre-OPEC meeting purchasing as buyers sought to cover physical
oil needs in case prices spiked.