China ramps up oil purchases from Africa and the Americas — OilPrice
China is increasing purchases of crude grades from Africa and the Americas amid a recovery in imports after a 10-year low in June. Higher demand from Asian buyers has also contributed to rising prices for oil from Canada, Brazil and Argentina, OilPrice reports.
Premium for Congolese oil rises
Congolese Djeno crude is being offered at a premium of $20 per barrel to ICE Brent quotations, anonymous traders told Bloomberg. Two weeks earlier, the premium stood at $15 per barrel.
Importers in Asia, including China, Japan and South Korea, have turned to buying oil even in Argentina to offset lost supplies from the Middle East. According to traders cited by Bloomberg, Asian refineries have been purchasing Argentina's Medanito grade in recent weeks. At least one cargo of this grade, which is compared with U.S. West Texas Intermediate crude in terms of characteristics, was loaded in August.
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China's imports remain below pre-war levels
According to OilPrice, China is also increasing imports of African and American grades, as well as Russia's ESPO blend. The publication links this to a sharp reduction in Iranian oil supplies after the United States reimposed a blockade on Iranian oil exports.
OilPrice estimates China's oil imports in August at approximately 7.3 million barrels per day. This is below the 11–12 million barrels per day level that the publication cites for the period before the start of the war in Iran. According to the publication, Beijing has eased restrictions on fuel exports, while refineries are replenishing inventories and taking advantage of acceptable refining margins.
Before the start of the war in Iran, China had accumulated about 1.4 billion barrels of oil in commercial and strategic storage, according to OilPrice estimates. The publication notes that small independent Chinese refineries, which had previously relied on cheap Iranian and Venezuelan oil, are suffering the most from the supply changes.
