Saudi Arabia’s crude oil supply to China is set to fall to about 36.5 million barrels in December, trade sources said on Monday, on weak demand from the world’s largest importer.
This is a second straight month of decline and the lowest volume since July, down from about 37.5 million barrels that Chinese refiners are expected to receive in November and about 46 million barrels in October, trade data collated by Reuters showed.
China’s state majors Sinopec 600028.SS, PetroChina 601857.SS and Sinochem will be lifting less crude in December while Saudi supply to its joint venture Fujian refinery will rebound as the plant is expected to complete maintenance and resume operations, they said.
The drop in China’s demand came as state oil company Saudi Aramco 2223.SE cut the December official selling prices for all grades of crude it sells to Asia.
Refining throughout China is set to decline further for the last quarter due to sluggish profit margins and fuel consumption in road transport.
Saudi Arabia is the No. 2 crude supplier to China after Russia.
Saudi crude exports to China fell 10.8% to 59.52 million metric tons (1.58 million barrels per day) in the first nine months this year from the same period a year ago, Chinese customs data showed.
Outside of China, two other North Asian refiners will receive full Saudi crude allocation for December, the sources said.
Source: Reuters (Reporting by Florence Tan and Siyi Liu; Editing by Christian Schmollinger and Angus MacSwan)
