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China’s April Trade Data and the Crude Oil Tanker Industry

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China’s April data

China (FXI) has released its key economic data for April, including import and export data, auto sales data, and the manufacturing index. The data help investors assess the outlook for the crude oil tanker industry.

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China’s impact

China, which has the second-largest economy in the world, has a significant impact on the crude oil tanker industry. It imports 60% of the oil it needs. Most of that oil is imported by sea using crude oil tankers, especially VLCCs (very large crude carriers).

Navios Maritime Midstream Partners (NAP) operates six VLCCs, and Tsakos Energy Navigation (TNP) operates three. Gener8 Maritime Partners (GNRT) has 22 VLCCs in its fleet, and DHT Holdings (DHT) has 27. Nordic American Tankers’ (NAT) fleet doesn’t have any VLCCs.

We’ve seen a distinct trend so far this year. China’s oil production is falling, while its oil demand is increasing. The trend is expected to continue into 2019. The trend should increase China’s oil imports, which benefits crude oil tankers.

China is the largest manufacturing hub in the world. A country’s oil demand is related to its manufacturing activities. Higher manufacturing activity translates to higher oil demand, while higher oil demand means higher tanker demand.

A country’s oil demand is closely related to its gasoline demand. China is a leading car manufacturer. In many ways, China is the key country for the tanker industry.

Series overview

In this series, we’ll see how China’s crude oil imports fared in April. We’ll also gauge China’s oil demand through the manufacturing industry’s performance and auto sales in April.

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