
Chinese Oil Imports Reach Yearly High in August, Yet Throughput Remains Weak
Chinese oil imports reached a peak for the year in August, but the country’s overall oil throughput remains lackluster, according to analysts from Bank of America.
In their latest client report, analysts highlighted that customs data revealed China, the world’s largest importer of crude oil, received 49.1 million metric tons in August, which translates to approximately 11.56 million barrels per day. This marked the highest monthly figure since August 2023 and was an increase from July’s 9.97 million barrels per day, which was the lowest in nearly two years.
The Bank of America analysts suggested that the increase in imports was likely a preparatory move ahead of the public holidays coming up in early October. However, they pointed out that processing levels remain “subdued,” with 59.1 million metric tons—or around 13.9 million barrels per day—being processed in August. This figure remained unchanged from July but represented a 9% decline compared to the same period last year.
Concerns regarding China’s tepid economic performance have contributed to limits on recent rises in crude oil prices, which have been driven by ongoing tensions in the oil-rich Middle East and fears of disruptions to US oil supplies.
In response to these economic challenges, Beijing recently announced a series of new stimulus measures aimed at stimulating economic activity. While investors have been calling for such interventions, it remains uncertain whether these measures will meet the substantial support that markets have been seeking.
The People’s Bank of China (PBOC) disclosed plans to lower reserve requirements for banks by 50 basis points to enhance liquidity in the financial system. In addition, the government will reduce mortgage rates for existing loans to bolster the struggling property market. The PBOC also cut a short-term repo rate earlier this week in an effort to further improve liquidity conditions.