China,the only respite for crude sellers

The throughput recovery is expected to lower the current crude inventory and free up more tanks to store cheaper crudes, while waiting for China’s product demand to emerge from the bottom.
 
As a result, crude imports are expected to rise above 10 million b/d in the coming months from the eight-month low of 9.7 million b/d in March, a Beijing-based analyst said.
 
With major refineries in most parts of Asia, including India, Indonesia, Thailand and Malaysia reducing run rates as demand for products slowed to a crawl, most crude sellers are looking to ship their cargoes to China, industry sources said.

“Only China is buying right now, ” a Singapore-based crude trading source said.
 
For regional crude grades in Asia, market sources said that spot buying had thinned since the beginning of the year as end-user demand has all but disappeared. However, trading houses continue to buy limited volumes from the spot market on hopes of selling these cargoes later, if and when demand and prices improve, market sources said.
 
Traders who continue to purchase these regional crude cargoes also noted that the only outlet for them was to either store the cargoes or ship them to China.

Availability of cheap barrels could ease China’s appetite for its favorite grades, including Russia’s ESPO crude and Brazil’s Lula crude, traders said.
 
“China's refineries don’t really care [about the type of crude] as long as the price is competitive,” the China-based crude trader said.