SINGAPORE/BEIJING—China’s crude oil imports slipped 8% in May from an all-time peak hit the month before, customs data showed, as the world’s top importer of the commodity curbed shipments from Iran amid tightening U.S. sanctions on that country.
China’s crude imports dropped to 40.23 million tonnes in May from 43.73 million tonnes in April, General Administration of Customs data showed on June 10.
That equates to 9.47 million barrels per day (bbl/d), down 11% from April, which has one fewer days, Reuters calculations showed, pressured by lower imports from Iran and as several major state refineries were shut for regular overhauls.
“The main reason for the fall in China’s crude imports is the Iranian imports which fell sharply in May,” said Seng Yick Tee, analyst at Beijing-based consultancy SIA Energy.
China started to scale-back imports of Iranian crude in May in the face of tougher U.S. sanctions on Tehran’s oil sales.
China has instead been stepping up purchases from other Middle East suppliers such as Saudi Arabia, Iraq and the United Arab Emirates, as well as from Brazil.
Also, several major refineries in China were shut for annual maintenance in May, while poor refining margins and a rise in oil product inventories helped crimp China’s crude demand, analysts said.
“We see tighter (crude) supplies and lower margins for refiners to keep imports lackluster next month as well,” ANZ analysts said in a note.
Still, China’s crude imports in the first five months of 2019 hit a total of 205 million tonnes, up 7.6% from the same period last year.
Meanwhile, China’s oil product exports also slowed in May, to 4.49 million tonnes, down from 6.17 million tonnes in April, the customs data showed.
Oil product exports for the first five months hit 27.09 million tonnes, up from 25.55 million tonnes in the same period in 2018.
China’s total gas imports, including LNG and pipeline imports, continued to ease ahead of summer.
Gas imports were at 7.56 million tonnes in May, up 3.6% from the same month last year but down slightly from 7.65 million tonnes in April, the data showed.
Saudi Energy Minister Khalid al-Falih said consensus was emerging among the OPEC+ group of oil producers to continue working towards oil market stability in the second half of the year, the Saudi-owned Arab News newspaper reported on Monday.
Former finance minister James Marape, a critic of a major global gas development deal, was elected by parliament as the new prime minister of Papua New Guinea on Thursday after weeks of turmoil over the handling of the South Pacific nation's resource riches.
U.S. crude producers may have lost the fast-growing China market because of President Donald Trump's trade dispute, but they have more than compensated by making inroads into the rest of top oil-consuming region Asia.