Saudi Arabia expanded its share of China’s oil market last month, outpacing rival producers as they compete to meet record demand from the world’s biggest energy consumer.
China’s imports from the Middle East producer jumped 37 percent from a year earlier to the highest level since July 2013, according to customs data. The world’s biggest crude exporter was the No. 1 supplier to the Asian nation, accounting for 17.4 percent of its overseas purchases, up from 15.1 percent in March.
The next three largest sellers -- Russia, Iran and Angola -- lost market share. Record imports by China are contributing to a recovery in benchmark oil from a six-year low amid speculation the purchases will help shrink the global supply glut that drove crude’s collapse in 2014.
Saudi Arabia has led OPEC’s policy of maintaining production to defend its market share and force U.S. shale drillers to curb the highest American output in more than three decades.
“Saudi Arabia is China’s top choice,” Li Li, a research and strategy director at ICIS China, a Shanghai-based energy consultant, said by phone from Guangzhou. “Refineries in China like the Saudi medium-to-heavy grade as most of them are familiar with that crude.”
The world’s second-biggest oil consumer bought 5.26 million metric tons of crude from Saudi Arabia in April, versus 3.84 million a year earlier, according to data e-mailed by the Beijing-based General Administration of Customs on Friday.
Record Imports
China’s overseas purchases totaled 30.29 million tons, or an unprecedented 7.4 million barrels a day, last month, government data compiled by Bloomberg show.
Saudi Arabia, the biggest member of the Organization of Petroleum Exporting Countries, pumped more than 10 million barrels a day of oil for a second month in April, according to the Paris-based International Energy Agency.
That demonstrates the kingdom “is intent on maintaining its policy to preserve its market share,” the IEA said in a report May 13. The Middle East producer shipped more crude in March than in any month since November 2005 while pumping at a rate of 10.29 million barrels a day, data from the Joint Organisations Data Initiative show.
China, which is forecast to account for 11 percent of global oil use this year, stepped up purchases to fill its emergency supplies as oil prices plunged last year and is expected to make available more capacity to store emergency stockpiles later in 2015.
Market Competition
“In a buyer’s market, everybody wants to lock supplies with China,” Gao Jian, an analyst with Shandong-based energy consultant SCI International, said by phone. “Oil producers have to compete head to head.”
While Russia’s sales to China rose 26 percent from a year earlier to 3.15 million tons in April, it’s market share declined to 10.4 percent from 11 in the previous month, the customs data show. Iran’s exports to the nation slid 11.6 percent to 2.91 million tons, accounting for 9.6 percent of total overseas purchases versus 10.1 percent in March.
Imports from Angola fell 30 percent to 2.86 million tons, the lowest since July 2014, while the African producer’s market share decreased to 9.4 percent from March’s 13 percent.
bloomberg.com
China’s imports from the Middle East producer jumped 37 percent from a year earlier to the highest level since July 2013, according to customs data. The world’s biggest crude exporter was the No. 1 supplier to the Asian nation, accounting for 17.4 percent of its overseas purchases, up from 15.1 percent in March.
The next three largest sellers -- Russia, Iran and Angola -- lost market share. Record imports by China are contributing to a recovery in benchmark oil from a six-year low amid speculation the purchases will help shrink the global supply glut that drove crude’s collapse in 2014.
Saudi Arabia has led OPEC’s policy of maintaining production to defend its market share and force U.S. shale drillers to curb the highest American output in more than three decades.
“Saudi Arabia is China’s top choice,” Li Li, a research and strategy director at ICIS China, a Shanghai-based energy consultant, said by phone from Guangzhou. “Refineries in China like the Saudi medium-to-heavy grade as most of them are familiar with that crude.”
The world’s second-biggest oil consumer bought 5.26 million metric tons of crude from Saudi Arabia in April, versus 3.84 million a year earlier, according to data e-mailed by the Beijing-based General Administration of Customs on Friday.
Record Imports
China’s overseas purchases totaled 30.29 million tons, or an unprecedented 7.4 million barrels a day, last month, government data compiled by Bloomberg show.
Saudi Arabia, the biggest member of the Organization of Petroleum Exporting Countries, pumped more than 10 million barrels a day of oil for a second month in April, according to the Paris-based International Energy Agency.
That demonstrates the kingdom “is intent on maintaining its policy to preserve its market share,” the IEA said in a report May 13. The Middle East producer shipped more crude in March than in any month since November 2005 while pumping at a rate of 10.29 million barrels a day, data from the Joint Organisations Data Initiative show.
China, which is forecast to account for 11 percent of global oil use this year, stepped up purchases to fill its emergency supplies as oil prices plunged last year and is expected to make available more capacity to store emergency stockpiles later in 2015.
Market Competition
“In a buyer’s market, everybody wants to lock supplies with China,” Gao Jian, an analyst with Shandong-based energy consultant SCI International, said by phone. “Oil producers have to compete head to head.”
While Russia’s sales to China rose 26 percent from a year earlier to 3.15 million tons in April, it’s market share declined to 10.4 percent from 11 in the previous month, the customs data show. Iran’s exports to the nation slid 11.6 percent to 2.91 million tons, accounting for 9.6 percent of total overseas purchases versus 10.1 percent in March.
Imports from Angola fell 30 percent to 2.86 million tons, the lowest since July 2014, while the African producer’s market share decreased to 9.4 percent from March’s 13 percent.
bloomberg.com
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