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Saudi Arabia Maintains Position of Top Oil Supplier to China

Saudi Arabia Maintains Position of Top Oil Supplier to China

Tuesday, 21 September, 2021 - 11:00
A view shows branded oil tanks at Saudi Aramco oil facility in Abqaiq, Saudi Arabia October 12, 2019. REUTERS/Maxim Shemetov

Saudi Arabia, the world’s largest oil exporter, maintained its leadership of crude suppliers to China for the ninth consecutive month in August, as major producers eased production cuts.

Data from the General Administration of Customs in China showed on Monday that Saudi oil imports rose 53 percent from the previous year to reach 8.06 million tons, equivalent to 1.96 million barrels per day, compared to 1.58 million barrels per day in July and 1.24 million barrels in August 2020.

The Organization of the Petroleum Exporting Countries (OPEC) and its allies, within the framework of the OPEC+ group, decided in July to ease production cuts and increase supplies by an additional 2 million barrels per day, by raising production by 0.4 million barrels per day every month from August to December.

China’s imports of Russian crude oil stabilized at 6.53 million tons in August, equivalent to 1.59 million barrels per day, compared to 1.56 million barrels per day in July.

The big difference behind Saudi supplies is due to Beijing’s decision to cut crude oil import quotas to independent refiners that prefer the Russian Espoo blend.

Crude oil arrivals from Malaysia more than doubled from year-ago levels to 1.75 million tons, with traders saying refiners might have rebranded Venezuelan heavy oil previously passed on as bitumen blend into Malaysian crude after Beijing imposed hefty import taxes on blending fuels.

Meanwhile, shipments from the United Arab Emirates fell nearly 40% on-year, a possible sign demand for Iranian oil passed on as grades including UAE supplies remained shy after peak arrivals early this year.

Oil prices fell during Monday’s trading after the US dollar jumped to a three-week high and the number of US drilling rigs increased, although nearly a quarter of US production in the Gulf of Mexico remained suspended after two hurricanes.

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