China focuses on Saudi oil

China's purchase of Saudi crude oil jumped 43 percent on the year in April to an average 1.53 million barrels per day compared to 1.07 million barrels per day in April last year. Business Times in the article China’s Saudi Oil Imports Jumps After Waiver On Iranian Oil Sanction Expires writes, that independent refiners continued to import more on Saudi as the sanctions on Iranian oil continues. Imports of Saudi and Russian oil increased after the waivers to purchase Iranian oil ended.

Oil from Saudi made up the largest share of crude imports of China. Oil imports reached 6.3 million tons in April surpassing Russian oil import during the reporting period at 6.12 million tons or 1.49 million barrels per day. China also increased its import of Russian oil. Russian oil imports increased from 1.35 million barrels per day to 6.12 million tons in April of last year, or 1.49 million barrels per day last month.

Customs data cited by Reuters implied that refiners in China increased their purchases of Iranian crude in April before the waivers for the sanctions ended. However, China ended its import of Iranian oil following the announcement of the United States not to extend the waivers.

Rahim Xare, who is a member of the economic commission of the Iranian parliament, said that China, Greece, India, Italy, Japan, South Korea, Taiwan, and Turkey, which were previously granted waivers, purchased from Iran a total of 1.6 million barrels of oil daily in March, but have ceased purchases since.

The Wall Street Journal reported that Businessmen in Tehran noted that Chinese companies were no longer buying Iranian oil. According to the report, Iran still hopes to resume its oil transactions with China. A private Iranian trader, who last delivered Iranian oil to China two months ago, negotiates up to 2 million barrels of oil to a Chinese mini-refinery but he had not yet received the approval of the governments of the two countries.

The General Admissions of Customs' data showed that Saudi imports grew to 6.30 million tons, or 1.53 million barrels per day on a daily basis, compared with 1.07 million barrels per day in the year-ago period.

The imports of Saudi oil is supported by high capacity refinery rates at Hengli Petrochemical Co. Ltd that can produce 400,000 barrels per day in its refinery in northeast China which is expected to be fully operational in late June. Saudi Arabia supplies about 70 percent of the demand from Hengli. China's top state-owned refiners, China Petrochemical Corp. (Sinopec Group) and China National Petroleum Corp. (CNPC), stopped their purchase of Iranian oil in May.