Beijing has bolstered its oil inventories from Russia to the highest level in three years
China has accelerated its stockpiling of Russian crude amid hefty discounts, with imports hitting a new record, surging to their highest levels in three years last month, Reuters reported on Wednesday.
June marked the largest monthly additions in China’s shipments of Russian oil as the country added 2.1 million barrels per day (bpd) to either its commercial or strategic reserves. This was up from 1.77 million bpd added to inventories in May and the most since June 2020, the news agency calculated, citing data from the Chinese General Administration of Customs.
China’s imports from Russia amounted to 2.56 million bpd in June, representing a staggering 44% surge compared to the same month last year, Chinese customs data showed.
Over the first five months of the year China added about 950,000 bpd to inventories, in a 28% increase from the 740,000 bpd added over the whole of 2022, the data showed.
Year-on-year deliveries of Russian crude jumped by 22% in the first half of 2023 to 2.13 million bpd, which helped Russia overtake its OPEC+ partner Saudi Arabia as the single biggest supplier to the world’s top crude importer so far this year, according to customs figures. Supplies from Saudi Arabia averaged 1.88 million bpd between January and June, according to calculations.
Reuters linked robust growth in imports to an expected substantial tightening of the oil market in the second half of the year.
The OPEC+ group of producers, led by Saudi Arabia and Russia, has been cutting output in a bid to balance the market since last November.
Earlier this month, Russia announced further cuts of 500,000 bpd starting in August following a similar move by Saudi Arabia. Riyadh said it would extend its voluntary crude output cut of 1 million bpd for another month to include August. The cuts will amount to 1.5% of global supply.
