CHINA DATA: Russian crude oil imports rise 13% on month to record high 2.27 mil b/d in March

China'simports of Russian crude oil jumped 12.9% to 2.27 million b/d (9.61 million mt) in March from the previous record high in February, data from the General Administration of Customs showed April 21, amid the heavy inflow of the long-voyage Urals grade.

The new record high also marked the first time a single supplier's monthly crude deliveries to China crossed 2.2 million b/d, according to historical GAC data. The previous monthly high by a single supplier was 2.17 million b/d, when China imported from Saudi Arabia in May 2020, the data showed.

The volume was within expectation as S&P Global Commodity Insights' data showed Russian crude imports by China's independent refineries rose sharply by 32% to 1.36 million b/d, or 5.74 million mt from their previous record high in February.

The imports by the independent sector accounted for almost 60% of China's total crude imports from Russia, S&P Global estimated. Majority of the rest barrels were being imported by CNPC under long-term contracts with Rosneft for about 800,000 b/d supplies via pipeline, while other state-owned companies Unipec and CNOOC received their first batch of seaborne shipments since the price cap on Russian crudes was in place.

Meanwhile, a few of the delayed deliveries of Urals cargoes, which were loaded in December, arrived in March along with January-February loading barrels, pushing the monthly volume to a record high. Usually, it takes more than 35 days for the Urals cargo to reach China, S&P Global reported.

"As all the delayed Urals cargos arrived, Russian crude imports are likely to be capped despite the state-owned oil giants join buying because of the rising competition against India and limited supply amid OPEC+ production cut," a Beijing-based analyst said.

Seaborne Russian crude imports were likely to fall about 20% to 1.26 million b/d in April from 1.59 million b/d in March, data intelligence Kpler showed.

The cost of the Russian crude imports averaged $72.3/b, $1.23/b lower than $73.53/b in February, GAC data showed. Cargoes from Saudi Arabia averaged $82.22/b in March.

The hefty import volume from Russia to China in March translated to 18.4% of market share for the country's crude import volume in the month, down from 18.9% in February, and lower than Saudi Arabia's 19.1% in May 2020.

Arab crude up 39%

Saudi Arabia was the second top crude supplier in March despite its shipment jumping 39.2% on the month, as it rose from a low base in February to 2.1 million b/d (8.9 million mt).

Amid Russia's expanded market share, Saudi Aramco in late March secured long-term outlets for 690,000 b/d crude with two downstream investments.

In the short-term, Saudi Aramco is expected to supply 480,000 b/d of crude to the operating 800,000 b/d Zhejiang Petroleum & Chemical, following the world's largest oil exporting company's definitive agreement in late March to buy a 10% interest in ZPC's parent company Rongsheng Petrochemical. Unlike its independent peers, ZPC did not emerge in Russian crude market.

In 2026, Aramco will supply 210,000 b/d of crude to a 300,000 b/d integrated refining and petrochemical project in northeast China it jointly invested with China's North Industries Group (Norinco) and Panjin Sincen Industrial Group.

In the first quarter, crude imports from Russia surged 32.7% on the year to 2.06 million b/d (25.29 million b/d), while Saudi Arabia's shipment amounted to 1.86 million b/d (22.82 million mt) with a 6.3% year-on-year increase.

Saudi Arabia's modest rise for Q1 failed to make up for the year-on-year declines of over 18% from Oman and Kuwait, resulting in total Middle East crude imports edging down 0.7% to 5.57 million b/d in the quarter. The oil-rich region's market share also fell to 50.1% from 53.8% a year ago in Q1.

"OPEC+ production cuts will keep the Brent–Dubai (EFS) spread narrow, making Brent-linked grades from the Atlantic basin more attractive to Chinese refiners," a London-based analyst said.

The GAC releases data in metric tons, which S&P Global Commodity Insights converts to barrels using a conversion factor of 7.33.

China's top crude suppliers (million mt)

Source: General Administration of Customs