As China closes in on the United States as the world's biggest crude oil importer, demand from private refiners and stockpiling of cheap oil are expected to keep imports at record levels after a wobble in the third quarter.
Despite slower growth in recent months–crude imports rose just 1.3% in September on a year earlier–buying for October-November delivery has picked up strongly, traders and analysts say, CNBC reported.
The purchases will ease concerns of a sharp slowdown in Chinese buying and support prices in coming months, analysts said.
"The increased buying has shown up in tanker movements and freight rates," said Energy Aspects analyst Virendra Chauhan, and analysts are upgrading earlier forecasts for second half growth.
"Despite a slowing Chinese economy, crude imports remain robust on the back of accelerated stockpiling activities into operating and commercial storage," said Wendy Yong, analyst at oil consultancy FGE. Since July, China has also granted nearly 700,000 barrels per day of crude import quotas to small refiners, known as "teapots", or roughly 10% of China's current total imports, as part of efforts to boost competition, attract private investment and create a new source of demand.
State-owned refiners are also restocking after a third-quarter lull. Unipec, the trading arm of Asia's top refiner Sinopec, bought 6 million barrels of North Sea Forties crude and 2.9 million barrels of Russian ESPO for loading this month, and it has also stepped up Angolan crude purchases for November.
FGE expects China's crude imports in the second half to rise by 12% from a year ago, up from a previous estimate of 10%. It forecast China's crude imports to rise 9% for the year.
Such a rise would take Chinese imports to 6.75 million barrels per day, not far off US imports of 7.3 million bpd. China's imports, which outpaced the United States in April, were roughly on par in September.
