China crude imports surged to a record in March, upending market expectations, as refineries there bought aggressively in anticipation of higher oil prices.
Analysts say many independent refiners are also trying to exhaust their import quotas so they can qualify for another round of quotas, which are expected to be issued by the government in June.
- In March, China crude imports jumped 19% from a year earlier to 39 million tons, or 9.2 million barrels, a day, according to data from the General Customs Administration.
“This is by far the highest level”. March was the first month the daily average topped nine million barrels.
As such, Chinese daily imports were well above the U.S., making it the world’s biggest crude importer for the month. In March, U.S. crude imports averaged eight million barrels a day, according to U.S. Energy Information Administration data.
Refineries world-wide typically ramp up their crude buying in the first quarter as gasoline demand usually rises with temperatures. For the quarter, China’s crude imports rose 15% from a year earlier.
Another driver of the recent growth: Three state-owned refineries with a combined capacity of 600,000 barrels a day are set to come online later this year.
Chinese oil players have increased their purchases of North Sea crude and oil from the U.S. as American oil producers are seen as offering price discounts to Asian buyers as a bid to penetrate the market there.