Chinese oil imports in August plummeted 12.5% from a year ago. This is according to new preliminary data from the General Administration of Customs reported by Dow Jones.
The 18.4 million metric tons reported is the lowest level since October 2010, DJN said.
This is the result of slowing economic activity.
“Since downstream demand is fairly sluggish, refiners don’t have the incentive to process much,” the wire quotes Zhu Chunkai, an oil analyst at Shandong-based energy consultancy Chem99.
Higher prices have also hurt refiners’ pockets. The value of China’s reference basket rose by 8.36% between Aug. 8 and Sept. 6, data from ICIS C1 showed. Refiners have cut volumes as a result of the declining demand.
GasBuddy.com’s Patrick DeHaan believes this is another sign worldwide crude prices will fall:
“I feel the market hasn’t adequately weighed the situation, and is bullish when the mood should be more somber. I can’t see how fundamentals would support fall/winter oil prices over $100 per barrel, unless we see something new and significant hit the press.”
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