Saudi crude oil exports to China will fall in July for a third straight month to about 36 million barrels amid plant maintenance and as some refiners opted for other sources of cheaper oil, several trade sources said on Tuesday.
The reduction underscores the challenge the world’s top oil exporter faces in maintaining market share in the world’s largest crude import market.
July exports are expected to be down from about 39 million barrels in June, possibly the lowest levels for the year, the sources said.
One state refiner and a private refiner cut nominations for Saudi crude in July versus June, they added.
State oil firm Saudi Aramco could not be immediately reached for comment.
Chinese refiners are cutting imports from Saudi Arabia, China’s No. 2 oil supplier, due to high term prices for Saudi crude and weak refining margins, the sources said.
This was despite Saudi Aramco cutting official selling prices for its crude exports in Asia in July for the first time in five months.
Sinopec 600028.SS, Asia’s largest refiner and Saudi Arabia’s biggest customer in China, is keeping the volume little changed in July from the previous month but the volume is the lowest this year, the sources said.
China’s Saudi oil imports fell 16.5% in the first four months this year to 26.13 million metric tons (1.58 million barrels per day) while imports from top supplier Russia gained 16.6% to 37.79 million tons, customs data showed last month.
Separately, Saudi Aramco will supply full contractual volumes to at least three other North Asian refiners in July, the sources said.
Source: Hellenic Shipping News
