Key facts
- China's crude oil imports in June fell 41.3% year-on-year to 7.12 million barrels per day.
- This volume represents the lowest crude oil import level for China since October 2016.
- Imports declined an additional 12% from May to June.
- Chinese refinery runs reached a four-year low in May and continued to decrease in June.
- Some Chinese refiners have not nominated term crude cargoes from Saudi Arabia for August.
- Saudi Arabia has significantly reduced its monthly crude allocations to China compared to last year.
China's crude oil imports in June plummeted to a decade low, falling 41.3% year-on-year to 29.27 million tons, or 7.12 million barrels per day, the lowest since October 2016. This decline extended a trend from May and was exacerbated by high prices and reduced flows through the Strait of Hormuz, impacting refinery operations which hit a four-year low in May and further declined in June. Some Chinese refiners have also reduced term crude orders from Saudi Arabia for August due to weak domestic demand, competition, and ongoing disruptions in the Strait of Hormuz. Saudi Arabia had previously set record-high premiums for its crude to Asia but has since slashed prices, facing increased competition from other Gulf exporters offering larger discounts and alternative shipping routes. The re-escalation of tensions in the Strait of Hormuz further disadvantages Saudi Arabia's shipping logistics.