UPDATE 1-China’s January Crude Oil Imports Hit Record High

From REUTERS

By Judy Hua and Chen Aizhu

BEIJING, Feb 12 (Reuters) – China’s crude oil imports rose 11.9 percent in January from a year earlier to a record 6.63 million barrels per day (bpd), data showed on Wednesday, as companies restocked ahead of the Lunar New Year holiday despite tepid demand growth.

The high figure could also be due to data distortions ahead of the week-long break that fell across the first week of February, as companies tend to advance book cargos that are due to arrive in early February.

The world’s top energy consumer took in 28.16 million tonnes, or 6.63 million bpd, of oil last month, up 5.1 percent from the previous record of 6.31 million in December of last year, according to the General Administration of Customs.

Demand for crude appeared less robust than the imports indicate as the top two state refiners Sinopec and PetroChina were due to process 1.9 percent less oil in January than in December, according to energy consultancy ICIS C1.

That suggests some of the imports went straight into storage. China will not release its official throughput data for the first two months of this year until mid-March.

“Refinery throughput is still kind of weak, this high amount of arrivals would mean some of the oil has to land in the tanks,” a Beijing-based crude oil trader said.

The higher import purchases also follow a three-month drawdown in China’s commercial crude oil inventories over the last quarter of 2013.

China’s implied oil demand growth dropped to its lowest in more than two decades in 2013, coming in at just 1.6 percent as softer economic growth sliced into consumption of transportation and industrial fuels such as diesel.

Oil markets largely dismissed the record Chinese import figures, with Brent crude futures holding steady near $109 a barrel.

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