21 Jun

Will China’s Crude Oil Imports Help Crude Oil Bulls?

WRITTEN BY Gordon Kristopher

China’s crude oil imports 

The General Administration of Customs of China reported that the country’s crude oil imports rose to 8.76 MMbpd (million barrels per day) in May 2017—compared to April 2017. Imports rose 8% in May 2017—compared to April 2017. China’s crude oil imports also rose 15% from the same period in 2016. The rise in crude oil imports from China could help crude oil (XLE) (SCO) (BNO) prices. China’s crude oil imports averaged 8.52 MMbpd between January 2017 and May 2017—13% higher than the same period in 2016. China’s crude oil imports averaged 7.6 MMbpd in 2016.

Will China’s Crude Oil Imports Help Crude Oil Bulls?

China’s crude oil imports and demand 

  • A rise in crude oil imports from teapot refiners led to the rise in China’s crude oil imports in May 2017. Imports from refineries rose 46% in May 2017—compared to May 2016. However, imports were 3% lower than April 2017. To learn more, read China’s Teapot Refineries Impact the Crude Oil Market.
  • China’s crude oil imports hit a record in March 2017 at 9.21 MMbpd. Imports hit the second-highest level in May 2017.
  • Reuters estimates that China’s crude oil production was at 3.83 MMbpd in May 2017—3.7% lower than the same period in 2016.
  • China’s crude oil refinery demand was at 10.98 MMbpd in May 2017—5.4% higher than the same period in 2016. China’s refinery demand is at the highest level in two years.
  • China’s fuel exports rose 6% in May 2017. High fuel exports will put pressure on refined product margins.

Impact on crude oil

Changes in crude oil imports from China could impact crude oil (IEZ) (XES) prices. The rollercoaster ride in crude oil prices impacts producers’ margins like Hess (HES), SM Energy (SM), and Bonanza Creek Energy (BCEI).

Read Traders Are Tracking the US Dollar, Rigs, and Inventories and Crude Oil Prices Could Collapse despite OPEC’s Production Cut for more on crude oil prices.

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