China escalates imports of crude from United States

Updated 2017-07-20 10:45:24 China Daily

Analysts said on Tuesday they believe a dramatic surge in imports of U.S. petroleum products into China in the current year is a win-win for the world's biggest trading partners.

China imported an average of 100,000 barrels of crude per day from the United States during the first five months of 2017, 10 times the level for the same period last year, according to official customs data.

The General Administration of Customs figures, released earlier this month, indicate the upward trend is also picking up speed, with imports surging to more than 180,000 barrels per day in April and May.

"China has long depended on fuel imports and the cheaper energy price, in addition to the massive amount of U.S. oil, has definitely contributed to the increase in imports," said Li Li, energy research director at ICIS China, a consulting company that provides analysis of the energy market here.

"The U.S.' increasing share of China's energy imports will also ensure the country's energy security, as China has been exploring different crude oil import channels," Li added.

U.S. Census Bureau data on international trade show that the combined value of U.S. crude oil, gas and refined petroleum exported to China in the first five months of 2017 totaled over .76 billion.

China purchased .6 billion of U.S. crude, representing 21 percent of U.S. global crude oil exports from January through to May.

The U.S. lifted a 40-year old ban on oil exports two years ago, as its production levels rose to their highest in decades, boosted by surging new shale oil and gas output.

Wang Lu, an Asia-Pacific oil and gas analyst at Bloomberg Intelligence, said U.S. oil exports could also lower OPEC's global market share of oil production and could undermine the producer group's willingness to comply with their agreed output reductions.

China became the biggest purchase of U.S. crude oil in February, overtaking Canada, against the backdrop of OPEC's scaling back of its production.

"While the output-cut deal has been extended to March 2018, whether OPEC will comply with that undertaking is uncertain," Wang said. Crude oil exports from U.S. to China surged to 759,000 metric tons in May, and its market share as a percentage of China's total oil imports rose to 2 percent from 0.1 percent a year ago, while that of the Middle East fell to 41.6 percent from 46.7 percent, Wang said.

China's biggest oil and gas producer, China National Petroleum Corp, said earlier it would import more crude oil and natural gas from the U.S., while also considering involvement in the country's growing liquefied natural gas export industry.

CNPC chairman Wang Yilin said his company was setting its sights on having a growing reliance on U.S. energy imports, on the sidelines of the Belt and Road Forum in Beijing.

"The U.S. has very rich oil and gas resources, and as China pursues a diversification of its crude supplies the U.S. will of course be one of the sources," he said.

"We will (also) consider exploring cooperation in areas such as jointly developing liquefied natural gas facilities and gas transport," he added.

Xiamen University energy expert Lin Boqiang, who has advised Beijing on oil policy, said that China should consider buying oil from places other than the Middle East.

The glut of U.S. crude also made it cheaper than oil from the Middle East.

"If there's an opportunity to buy oil from somewhere else, we should," he said.

"The precondition is that it must be economical."

Also in the News

Nicole Kidman Recalls Oscar Glory: Loneliest Time
Showbiz2016/06/16 13:58January 16 2019 20:32:38

Nicole Kidman Recalls Oscar Glory: Loneliest Time

Attending Shanghai International Film Festival, Nicole Kidman talks about her role in "Grace of Monaco".

Labor Day Travel Peak Starts
Also in the News2014/05/01 12:16January 16 2019 20:32:38

Labor Day Travel Peak Starts

Johnny Depp Delivers a Speech 'Evolve the Future' in 'Transcendence'
Also in the News2014/04/18 13:18January 16 2019 20:32:38

Johnny Depp Delivers a Speech 'Evolve the Future' in 'Transcendence'

Hollywood star Johnny Depp's speech in the upcoming new film "Transcendence" has been disclosed on Friday, April 11th.

China World Business Sports Showbiz Audio
C4 My Chinese Life The Sound Stage China Revealed Showbiz Video Travel Video
China World Fun Travel Entertainment Sports
Beijing Shanghai Guangzhou
Live Music Opera & Classical Movies Traditional Shows Exhibitions
Learn Chinese:
Chinese Studio Living Chinese Everyday Chinese Just For Fun Chinese Culture Buzzwords