China’s crude oil imports in 2019 surged 9.5% from a year earlier, setting a record for a 17th straight year, as demand growth from new refineries built last year propelled purchases by the world’s biggest importer, data showed.
Last year, China imported a record 506 million tons of crude oil, according to data from the General Administration of Customs. That is equivalent to 10.12 million barrels per day (bpd), according to Reuters’ calculations based on the data.
Chinese crude imports have set records every year since 2003, according to customs data on Refinitiv Eikon.
December arrivals were 45.48 million tons, customs reported. That is equivalent to 10.71 million bpd, according to Reuters’ calculations, the third-highest ever on a daily basis and down from a record of 11.13 million bpd set in November.
The annual increase equates to 882,000 bpd in incremental purchases, largely because of demand from new plants that added 900,000 bpd to China’s oil-processing capacity, although some of the units started operating only in December.
December imports were boosted by private refiners using up their annual import quotas, while state plants stocked up on oil before the holiday shutdown that accompanies China’s Lunar New Year festival, which falls in late January this year.
“Chinese independent refineries, including two mega projects Hengli and Rongsheng, stepped up purchases before year-end to maximize the utilization of crude import quotas,” said Chen Jiyao, oil consultant at FGE.
However, state refiners likely slowed down opportunistic purchases amid elevated freight rates in October, resulting in slightly lower December arrivals, said Chen.
Last year marked the biggest penetration of private chemical companies into China’s refining business, after the emergence between 2016 and 2018 of smaller independent oil processors often known as “teapots”.
Hengli Petrochemical (600346.SS) and Zhejiang Petrochemical Corp, controlled by Zhejiang Rongsheng Holdings, each added 400,000 bpd in processing capacity, mainly focused on petrochemical output. That boosted China’s crude oil imports notably from Saudi Arabia, helping the kingdom reclaim its title from Russia as China’s top crude supplier.
Meanwhile, natural gas imports, including fuel supplied as liquefied natural gas (LNG) and via pipeline, were 9.45 million tons, the third-highest on record on a monthly basis.
The hefty December purchases included LNG imports that rose to a record last month with China overtaking Japan the world’s top importer of the fuel for the second month in a row.
Imports 2019 expanded 6.9% to 96.56 million tons, with the annual growth slowing from 31.9% recorded for 2018.
China’s gas consumption slowed last year as Beijing eased its coal-to-gas switching program amid a slowing economy and growth in domestic gas output.
Tuesday’s data also showed China’s refined fuel exports in 2019 rose 14.1% from a year earlier to a record 66.85 million tons as refinery throughput outpaced domestic fuel demand growth. December exports were 6.79 million tons.
China raised the volumes of its first batch of 2020 fuel export quotas by 53% from a year earlier to 27.99 million tons.
Reporting by Chen Aizhu and Beijing newsroom; Editing by Kenneth Maxwell and Christian Schmollinger