Last month’s plunge in crude to $30 a barrel proved too much of a bargain for China to turn down, even as its economy lurches toward the weakest growth in a generation.
Chinese companies booked tankers to collect more West African crude in February than in any single month since at least 2011, data from the physical shipping market collated by Bloomberg show, Bloomberg reported.
It also increased its purchases of oil from producers in the North Sea and Russia. The voyages are all thousands of kilometers farther than the Middle East, which supplies most to the Asian country. Oil has plunged this year amid signs that China’s economy is slowing. The nation’s growth will slow to 6.5% this year, the weakest since 1990, according to forecasts and government data compiled by Bloomberg.
China shipped four vessels of North Sea crude in January, compared with nine in the whole of 2015, ship-tracking data show. In addition to three supertankers of Forties crude, the country also bought 1 million barrels of Norwegian Ekofisk crude, the first time it has done so in seven months.
This month’s shipments are part of a bigger trend, too. China imported a record volume of crude in December as the nation’s refineries boost runs to meet growing demand for gasoline in the world’s biggest automobile market and naphtha, an oil derivative used in the petrochemicals industry.
Shipping rates for very large crude carriers to haul oil from West Africa to China dropped to $24.44 a ton last week, the lowest since October. Exports of West African crude to all Asian countries, including India, Taiwan and Indonesia, are set to rise to 2.14 million barrels a day in February. That compares with 1.95 million in January and will be the highest in four years.
