China’s crude oil imports from the US for July have fallen sharply from June, and are expected to drop even further for August, vessel tracking data showed, as Beijing’s tariffs on US crude imports get closer to implementation. China’s US-crude oil imports for July-August tank from June’s record Unipec continues to offer US cargoes to end-users in Asia, Europe Tankers on the US-China route expected to change course in coming weeks
The decline is reflected in changing trade patterns of oil tankers loaded with US crude headed to Asia and in the procurement activity of state-run Unipec, the trading arm of China Petroleum & Chemical Corp or Sinopec, the world’s largest refiner by capacity. “Sinopec will continue to take deliveries of crude from the US in August, but will reduce buying from the producer for the rest of the year,” said an executive at a Sinopec refinery, who declined to be named.
Sinopec has lost buying interest in US crude. London-based market sources said Unipec resold its June-loading US cargoes after Beijing announced in mid-June that it was considering imposing a 25% import tariff on US crude. Asian refineries also confirmed receiving offers for Unipec’s US cargoes. Unipec had purchased nearly 16 million barrels of light sweet US crudes in June. These cargoes included the WTI Midland, Eagle Ford, Bakken and Domestic Sweet Blend grades, and were expected to be delivered to China over July-August. China received 14.65 million barrels of US crude in June, which was a historical high, but volumes more than halved to just 6.9 million barrels in July, according to S&P Global Platts’ vessel tracker cFlow. Arrivals in August are expected to shrink even more to around 6 million barrels.