China fuel exports hit record in July, crude imports up 1.2%
(Reuters) China's fuel exports rose to a record in July as easing demand growth and a surplus in refined oil products pushed refiners to increase shipments to overseas buyers.
The refined fuel exports surged 52.3% from a year ago to a monthly record 4.57 M tons, data from the General Administration of Customs showed on Monday.
China imported 2.08 M tons of oil products in July, down 13% from last year, leaving net exports at 2.49 M tons, or 562 Mbpd.
China's exports of fuel products have risen sharply this year, up around 46% for the January-July period, reflecting this year's swelling refinery throughput at private oil processors and adding to worries that refining margins might come under persistent pressure.
"Growth in China's fuel exports will be strong throughout Q3," a Beijing-based trader said. "Refiners are starting to tighten crude runs as well as increase exports to balance the surplus in the domestic market."
The domestic oil product surplus and rising crude stockpiles are dragging on growth in crude oil imports, which rose just 1.2% from a year ago to 31.07 M tons in July, or about 7.32 MMbpd, the customs data showed.
On a daily basis the volume was the lowest since January, and down from June's 7.45 MMbpd. It was the second month that annual growth in crude imports had eased.
Thomson Reuters' Research & Forecasts had estimated July's crude imports would fall 2.1% from a year ago.
China's private or independent refiners, known as teapots, have been a main driver of crude imports, ramping up refinery runs despite the oil product glut and accounting for over half of incremental crude oil purchases in the first half of 2016.
International trading houses as well as major oil exporting countries are eyeing this new group of crude buyers, who are rushing to fulfil their import quota before the year end.
The National Iranian Oil Company (NIOC) sold a 2 MMbbl cargo to teapots in July, following rare shipments to the independents from Saudi Arabia and Kuwait.
For the first seven months of the year, China imported 217.6 M tons of crude oil, or 7.46 MMbpd, up 12%.
Reporting by Meng Meng and Aizhu Chen; Editing by Tom Hogue
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