June 22, 2024
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OIL & GAS

Saudi Oil Exports to China Drop for Third Straight Month in July

Saudi Arabia’s crude oil exports to China are set to fall for the third consecutive month in July, dropping to around 36 million barrels.

This decline is due to plant maintenance and some Chinese refiners opting for cheaper oil alternatives, according to several trade sources.

July exports are expected to decrease from approximately 39 million barrels in June, potentially marking the lowest levels for the year.

One state refiner and a private refiner in China have reduced their nominations for Saudi crude in July compared to June.

According to Reuters, Chinese refiners are cutting imports from Saudi Arabia, which is China’s second-largest oil supplier, due to high term prices for Saudi crude and weak refining margins.

This trend persists even though Saudi Aramco cut official selling prices for its crude exports to Asia in July for the first time in five months.

Sinopec, Asia’s largest refiner and Saudi Arabia’s biggest customer in China, is maintaining its import volume from Saudi Arabia for July at the same level as the previous month. However, the volume is still the lowest this year.

China’s imports of Saudi oil fell by 16.5% in the first four months of this year to 26.13 million metric tons (1.58 million barrels per day), while imports from top supplier Russia increased by 16.6% to 37.79 million tons, according to customs data from last month.

Separately, Saudi Aramco will supply full contractual volumes to at least three other North Asian refiners in July.

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