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China’s crude oil imports surged to a two-year high in November, driven by sharply discounted prices from sanctioned suppliers, prompting refineries to ramp up purchases. According to government data cited by Reuters, imports averaged 12.38 million barrels per day (bpd) last month, up 4.88% year-on-year and the highest since August 2023. Compared to October, imports rose 5.24%, bringing the January-November total to 521.87 million tons (11.45 million bpd), a 3.2% increase from the same period last year.
Supplier dynamics shifted notably. Russian exports to China fell by 157,000 bpd to 1.19 million bpd in November, while Saudi Arabian imports surged by 345,000 bpd to 1.59 million bpd, reclaiming the top supplier spot. Iranian supplies also jumped significantly, rising 233,000 bpd from October to average 1.35 million bpd.
Emma Li, Head of China Analysis at Vortexa, noted that deep discounts on Iranian and Russian oil due to sanctions significantly boosted Chinese refiners’ profit margins. “Many refineries have applied for early 2026 quotas to capitalize on these price advantages,” she stated.
The import surge comes amid warnings that China’s crude demand may remain weak until mid-2024. While a faster-than-expected economic recovery and strong petrochemical demand are projected to lift 2024 oil consumption by 1.1%, CNPC’s Economic & Technology Research Institute warns that transport fuel demand has likely peaked.
In Shandong, home to numerous independent refineries, import and processing activities have intensified following Beijing’s recent quota allocations. The rapid purchasing pace is depleting inventories, a trend analysts say could ease domestic oversupply in the year’s final weeks.
ABN AMRO highlights a looming global oil surplus driven by weak demand growth and rising output from both OPEC+ and non-OPEC producers. Analyst Altaghlibi predicts this oversupply will persist through 2026, with sluggish demand growth and expanding supply likely exerting prolonged downward pressure on crude prices.
ABN AMRO forecasts Brent crude averaging $58/barrel in Q1 2026, declining to $52/barrel as oversupply intensifies. By year-end 2026, Brent is expected to fall to $50/barrel, averaging $55/barrel annually.
Source: Oilprice
