LAUNCESTON, (Australia): Asia’s crude oil imports most likely rose to a record high in November, but much of the strength was because refiners were ensuring sufficient inventories ahead of possible disruptions of shipments from Russia.
A total of 119.12 million tonnes of crude, equivalent to 29.1 million barrels per day (bpd) was landed in November, according to data compiled by Refinitiv Oil Research.
This was sharply higher than the 25.6 million bpd in October and the 26.6 million bpd in September, with gains led by China, India and South Korea. The European Union’s ban on crude imports from Russia comes into effect on Dec. 5, along with other measures that are aimed at making it harder for the world’s second-biggest oil exporter to profit from its energy exports.
Although China and India, the world’s biggest and third-largest crude importers, haven’t signed up to such a ban, they may find it difficult to continue to import at the hefty volumes of recent months because of constraints with shipping capacity, financing and insurance.
For this reason it appears both Asian giants splurged on Russian crude in November, with Russia once again surpassing Saudi Arabia as China’s biggest supplier. China imported 1.9 million bpd from Russia in November, up from 1.82 million bpd in October, while Saudi Arabia supplied 1.72 million bpd last month, a drop from October’s 1.87 million bpd. China’s total imports of 12.16 million bpd in November are the most since March 2021, and are almost 2 million bpd higher than October’s 10.2 million bpd, according to Refinitiv data.
Hardly any of this strength is because of stronger domestic demand; rather, it’s a combination of factors that may not be sustained. On the temporary front is the start-up of two new refining units with a combined capacity of 720,000 bpd.
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