China's crude oil imports hit a record high in 2023, rising by 10% year-over-year and breaking the previous record from 2020 when the world's top crude oil importer took advantage of the price crash to gorge on cheap crude.
Last year, China's crude oil imports averaged 11.3 million barrels per day (bpd), up by 10% compared to 2022, according to Chinese customs data compiled by Bloomberg and the U.S. Energy Information Administration (EIA).
After China lifted the Covid-related restrictions in early 2023, Chinese refiners boosted imports to record-high levels last year, to support transportation fuel demand and produce feedstocks for China's growing petrochemical industry, the EIA noted in an analysis published on Tuesday.
Russia, thanks to cheaper crude supply, was China's top source of crude imports last year, the data showed. Russia was also the supplier whose crude sales in China jumped the most.
In 2023, Russia, Saudi Arabia, and Iraq were China's main sources of crude oil imports. Compared with 2022, China's 2023 crude oil imports increased the most from Russia, Iran, Brazil, and the United States.
Between 2019 and 2021, Saudi Arabia was China's top crude oil supplier, with Russia second with 15% of Chinese imports.
In 2023, Russia was China's top source of crude oil imports, supplying 19% of China's crude oil imports, which averaged 2.1 million bpd, the EIA said.
The surge in Chinese crude oil imports from Russia was the result of discounted Russian prices due to the Western sanctions and price caps on Russia's crude.
While China bought large additional volumes of crude from Russia, it reduced imports from Western Europe, notably from Norway and the UK, due to the higher prices of Western European crudes compared to the discounts on Russian oil, the data showed.
This year, China has continued to import large volumes of crude from Russia, despite only a 0.7% increase in overall Chinese crude imports in January to March 2024. Much of the increase in Chinese crude oil imports in recent weeks has been due to cheap abundant flows of Russian crude, which - hampered en route to India by the U.S. sanctions - has found a home in the world's top crude oil importer, analysts say.
By Tom Kool for Oilprice.com
Tom majored in International Business at Amsterdam’s Higher School of Economics, he is Oilprice.com's Head of Operations More
Comments
The indications are there for all to see in terms of China's economy growing at 5.3% in the first quarter of 2024 beating its own projection of 5%, rising industrial production and retail sales and also rising commodity imports including oil, LNG, coal and metals.
Still, this won't stop the IEA from casting doubt about a slackening of China's oil import in crude imports and Western disinformation media talking about weaknesses in its economy.
Dr Mamdouh G Salameh
International Oil Economist
Global Energy Expert