This year China may overtake the U.S. and become the world leader in oil imports. Oil imports this year will rise to 7.5 million barrels./day, c record 6,68 MB/day predicts Jun Folan, Vice President, Unipec, trading unit of Chinese oil refiner Sinopec, Asia’s largest. This assumption, he said Thursday at the Russian-Chinese oil and gas forum in Beijing.
Previously, Li Li analyst from research firm ICIS China expected that the volume of purchases of oil abroad may reach this year of 370 million tonnes (7.2 million barrels./day), what’s more the projected rate of oil import in the United States — 363 million tonnes (7,08 million barrels./day), reported Bloomberg.
The world leader in oil imports China could achieve not only due to the growth of foreign supplies — PRC procurement of raw materials in 2015 increased by 8.8% from the General administration of customs of the PRC, — but because of the growth of own manufacture of oil to the US, reducing their dependence on imports. Supply of raw materials in the U.S. has consistently reduced since 2005.
In February — for the first time in history, the Chinese imports of oil exceeded 8 million barrels./day leaving behind the US, the world’s largest consumer of hydrocarbons.
China will continue to increase its purchases of oil abroad to ensure raw material growing refining sector and the replenishment of the strategic reserves, predicts Standard Chartered Bank in a note dated March 24. The Bank’s forecast, oil imports in China will exceed 10 million barrels./day. by the end of 2018 — beginning of 2019. “Sustained increases in oil import in the PRC takes place in parallel with the growth of the Chinese refining sector, noted Bank analyst Priya Balchandani. — At the same time the country is increasing its strategic reserves of oil products”.
China is using the fall in oil prices to increase its strategic reserves. Beijing is also actively investing in increasing refining capacity amid rising demand for oil products that the country has to buy abroad: liquefied petroleum gas, naphtha and fuel oil, says the Bank. In parallel, Beijing has continued to build up reserves for emergencies.
The desire to save oil for future use is so great that this year China can proceed to the formation of four more strategic oil reserves equivalent to 100 days of imports. The reserves should be formed by 2020.
The growth of oil refining
Driver of Chinese demand for oil will become private companies that buy oil abroad. Earlier, China issued 13 private refinery quota on oil imports with a total volume of 55 million tonnes, or 18% of total Chinese imports.
The growing demand for gasoline and jet fuel will provide significant volumes of oil refining in the world’s largest automotive market, expects Standard Chartered. While Beijing increased its exports of diesel fuel in the face of declining demand weakened due to the reduction of industrial production.
According to Standard Chartered Bank, the demand for petroleum products in the country grew by 6.2%, to 9.4 million barrels./day. in 2015, and this year it will increase by 420 thousand Barr./day. in 2016. China national petroleum Corporation (China National Petroleum Corporation — CNPC) forecasts growth to 11.32 million barrels./day. CNPC according to the forecast, net oil imports by China in 2016 will increase by 7.3%, to 7.14 million barrels./day.
Only in 2016, China will have 37% of global demand for petroleum products.
The increase in oil imports and refining capacity will contribute to implemented by Beijing pricing policy. Last year the national Commission for development and reform of China took the decision not to lower the price of gasoline and diesel fuel, if the price of oil is below $40/bbl.
“Chinese demand for oil will continue to encourage private refineries purchasing and import volumes, as well as the desire to build up strategic reserves at low prices, — quotes Bloomberg words. — The U.S. dependence on oil imports will gradually decrease due to increasing production within the country”.