Saudi Arabia, the world’s biggest oil exporter, overtook Russia in June, recovering its position as China’s top crude supplier in June, after trailing behind Russia in the previous three months, customs data showed on Thursday (July 21).
Data from the Chinese customs revealed that China imported 4.569 million tons of crude from Saudi Arabia in June, or 1.112 million barrels per day (bpd). The amount was down 14.2 percent on the year but compared with 961,000 bpd in May, according to the data.
Saudi imports edged up 0.24 percent in the first six months of the year versus a year ago, to average 1.06 million bpd.
Russian exports to China have climbed on demand from independent refiners since late 2015 after the country allowed them to import crude for the first time.
China imported 4.107 million tons, or around 999,420 bpd, of crude in June from Russia, down from a record 1.24 million bpd in May.
For the first half, imports from Russia rose 35.3 percent at 26.276 million tons, or 1.05 million bpd, just behind Saudi Arabia.
“Beijing is probably quite pleased with the competition for shares of China’s crude oil market,” said Washington-based China energy expert Erica Downs of the Eurasia Group.
“The government doesn’t want to be too dependent on any one supplier, so competition between major suppliers is a welcome development, especially if it results in lower prices.”
Nicknamed “teapots” due to their relative smaller scale, the independents contributed to more than half of China’s 930,500 bpd incremental crude purchases during the first half of 2016.
Stockpiling to boost government reserves was another driver for imports, as new tanks became available including this month.
A new tank farm in Hainan province, a 17.6 million-barrel site owned by privately-run CEFC China Energy, received its first shipment early in July.
Imports from Iran rose 16.1 percent in June over a year earlier to 780,175 bpd, up from 671,176 bpd in May. Imports for the January-June period gained 2.5 percent.
Shipments have held relatively steady as Tehran has been focusing on recouping lost markets in Europe after sanctions were lifted, Iranian oil sources say.
Sharp gains in Chinese imports also came from smaller OPEC producer Kuwait as well as Venezuela. Kuwait supplied 45 percent more in June at 1.336 million tonnes, or 325,100 bpd.
Supplies from Venezuela shot up 88 percent in June and for the first six months went up 35.5 percent at 9.936 million tons, or 398,500 bpd.