Independent Oil Refiners in China Have Increased the Imports of Heavy Oil from North AmericaFeb 27th, 2017
Since the end of 2016 Chinese independent oil refiners have increased oil purchases from North America. Big oil traders are completely certain that the import of raw materials from these regions will only increase. Some industry traders believe that this is due to the decline of heavy oil by OPEC countries to China, as well as the presence of heavy feedstocks in Canada and the United States.
According to the sources of shipping companies, in January China imported 600 thousand barrels of different grades of oil from North America. In upcoming spring, Chinese manufacturers plan to buy about 1 million barrels of oil brand Mars mined in the U.S. part of the Gulf of Mexico. As supplementary to this trademark, China will purchase an additional 1 million barrels of the raw material of unidentified brands.
The reconstruction of major regional oil refining units has allowed independent Chinese businesses to increase the consumption of heavy oil. The demand for this raw material is explained by its high density and viscosity plus relatively low cost in the global market that ensures considerable profit from its processing.
The implementation of the Vienna agreements has forced OPEC to reduce heavy oil supply, particularly from Saudi Arabia and Venezuela, which naturally increased the price of this raw material. Until this point, Venezuela has been the main supplier of heavy oil to China. To ramp up the production, China had to increase the imports of oil from North American countries. However, in addition to the largest oil suppliers from Canada and the United States, Chinese consumers are considering the purchase of oil from other countries in the Atlantic basin and from the Russian Federation.
The Asian manufacturers prioritise the Mars oil over such brand as WTI (Western Texas). The demand for it will keep on growing due to the increase of the exports of Asian goods. An unknown source reported that among the recent most active importers of heavy oil from North America are companies Wonfull Shandong petrochemical group and Sinopec.