INDIA SLOWS IMPORTS
This could extend to other major buyers in Asia, with the
region's second-biggest importer India showing signs of
moderating crude appetite in April.
Imports were estimated at 4.60 million bpd in April, down
from the eight-month high of 5.02 million bpd in March.
It's also worth noting that India's refiners are continuing
to switch to cheaper Russian crude, with arrivals in April at
1.68 million bpd, only slightly down from the record high of
1.72 million bpd in March.
Russia has become India's largest crude supplier, displacing
erstwhile OPEC+ ally Saudi Arabia, with India's April imports
from the kingdom dropping to the lowest since September 2021.
Russian crude is also winning against Saudi oil in China,
with April arrivals of 2.10 million bpd beating out the 1.73
million bpd from the Middle East's top exporter.
Outside of the two Asian heavyweights, there was a mixed
picture with number three importer Japan recording arrivals of
2.77 million bpd, up slightly from March's 2.52 million, while
fourth-ranked South Korea saw imports slip to 2.56 million bpd
in April, a 10-month low and down from 2.96 million bpd in
March.
The overall view on Asia's imports is that April showed a
loss of momentum after a strong start to the year.
Whether the slower April imports are mainly because of
technical and temporary factors such as refinery maintenance, or
if they signal the soft global economy is starting to drag Asian
demand will become clearer in May and June.
The opinions expressed here are those of the author, a columnist
for Reuters.
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GRAPHIC-Asia's crude oil imports vs Brent price: ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
(Editing by Kim Coghill)
(The opinions expressed here are those of the author, a
columnist for Reuters.)
By Clyde Russell
LAUNCESTON, Australia, May 4 (Reuters) - The strong
start to the year for Asia's imports of crude oil came to a halt
in April, with arrivals dropping to a seven-month low as top
buyers China and India trimmed purchases.
A total of 108 million tonnes, or 26.39 million barrels per
day (bpd) was imported by Asia last month, according to data
compiled by Refinitiv Oil Research.
This was down from March's 27.6 million bpd, which in turn
was lower than February's 29.4 million bpd and the 29.13 million
bpd in January.
The decline in April arrivals was led by China, the world's
largest crude importer, with Refinitiv estimating imports at
10.67 million bpd, down from the 34-month high of 12.37 million
bpd in March.
It was always likely that China's imports would pull back in
April as that month and May are the peak season for refinery
maintenance.
But after the strong start to the year for China's crude oil
imports, there are now several question marks over the outlook
for coming months, as the rebound in the world's second-biggest
economy appears uneven.
The official manufacturing Purchasing Managers' Index (PMI)
dropped to 49.2 in April from 51.9 in March, slipping below the
50-level that demarcates expansion from contraction for the
first time since December.
The PMI was also below market expectations for a positive
outcome of 51.4.
Manufacturing is one of the key pillars of China's economy
from a commodity demand perspective, the others being
construction and infrastructure.
The news here is somewhat mixed, with infrastructure
investment rising 8.8% year-on-year in the first quarter,
outpacing a 5.1 rise in overall fixed-asset investment, while
property investment fell 5.8%.
There is also the question of crude prices and the lag
between moves in these and imports, given the time between
refiners ordering oil and its delivery can be as long as three
months.
Crude oil prices were kicked higher at the start of April
when the OPEC+ group of producers surprised the market by
announcing an additional 1.16 million bpd of output cuts.
Benchmark Brent futures rose from just below $80 a
barrel to a peak of $87.49 a barrel on April 12, but have since
slipped back to end at $72.33 on Wednesday as concerns over
global growth trumped fears of tighter supply.
Nonetheless, the rise in Brent futures, which was
accompanied by higher official selling prices for May cargoes
from Middle East exporters such as Saudi Arabia, may put a
dampener on Chinese demand for May and June cargoes.
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