On Wednesday (March 10), Kevin Wright, an analyst at Paris-based Crude Oil information agency Kpler in Singapore, said that China’s crude oil imports from Iran in March will reach 856,000 barrels per day, a nearly two-year high and a 129 percent jump from February’s imports; Wright noted that the figure includes crude oil imported from the Middle East, Singapore, Malaysia or Indonesia, where the ship was exchanged at sea in the nearby waters. The reason is that the Chinese Communist Party wants to conceal the source of imports.
According to the report, Iranian oil exports to Shandong Province surged this month, causing congestion and overflowing storage tanks in Shandong ports. Shandong province is China’s major refining town, with about a quarter of the country’s refining capacity located there.
Kpler noted that tankers waited an estimated 12 days in Shandong last week, longer than the 8 days the week before. Oil stocks at ports in Shandong province climbed to a one-year high last month, according to data from Chinese commodity data agency Zhuo Chuang Information.
International oil prices have risen recently on vaccine optimism, briefly topping $71 this week after a drone attack on the largest oil export terminal in Saudi Arabia; in terms of demand from the Chinese Communist Party, mainland China’s crude oil imports are estimated to have grown to an average of 11.1 million barrels per day in January and February, up more than 20 percent from the end of last year.
The report noted that the Trump administration imposed sanctions on Iran in mid-2018, forcing Iran to sharply lower its oil prices in the hope of attracting buyers, and the export volume part also dropped sharply from about 2.5 million barrels per day to the current production of about 2 million barrels per day, most of which is used domestically.
Crude oil traders said Iran’s oil shipped to mainland China is usually $3 to $5 per barrel cheaper than Brent crude, prompting some mainland Chinese companies to stock up on the country’s oil. Iran, on the other hand, will ship its oil after being sanctioned by Trump by bypassing, changing ships and shutting down positioning.
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