China’s crude oil imports in June hit a record high, according to a market analysis by OilX Research, in a sign that China’s thirst for crude oil is not being hampered by the coronavirus.
In June, according to data compiled by OilX, China’s crude oil imports hit a record high of 11.93 million bpd—an increase of 820,000 bpd from May levels, which were also at record levels.
This 11.93 million bpd represents a 2.4 million bpd increase year over year, which is a 25.4% increase.
OilX attributes this increase in June to the restart of its economy, along with favorable crude oil prices and spreads.
So much so has the environment been kind to thirsty importers that China is experiencing a nagging backlog of tankers that are piling up in its ports, with about 40 million barrels waiting in line to be offloaded in the Yellow Sea—up from 1.8 million barrels of oil sitting in stationary vessels in the Yellow Sea in March.
Besides the overall increase, the breakdown of China’s imports by country are shifting, with China importing more oil from Brazil (451,000 bpd more in June) and Angola (309,000 bpd more in June), while importing less oil from Saudi Arabia and Iran.
Saudi Arabia has raised its oil prices three months in a row as Middle Eastern benchmarks strengthened and supply continues to tighten at least for the rest of July. Aramco raised its crude oil price to Asia to $1.20 above the Oman/Dubai average.
According to Hellenic Shipping News, China was nearly out of space in early June to hold all the oil that they are getting on the cheap, using as much as 69% of its storage capacity to hold the 33.4 million tons it had accrued at the time.