According to preliminary data, US crude oil imports declined by 263 tb/d or 2.6% to average more than 9.0 mb/d in August. Crude oil imports touched almost 9.6 mb/d in the week ending 26 August before falling sharply by more than one million barrels per day due to weather disturbance. US crude oil imports in August remained around 440 tb/d below last year, when imports stood at 9.5 mb/d. Imports averaged 8.9 mb/d between January and August, compared with 9.4 mb/d for the same period a year ago, implying a 5.1% decline. Product imports have dropped steadily since April this year and currently stand at a level of 2.0 mb/d. Compared to the month before, the decline is around 236 tb/d or 10.4%. According to y-o-y data, there is a sharp drop of around 782 tb/d or 27.8%.
Gasoline and jet fuel were the main contributors to the decline of products in August. Gasoline imports fell by 86.2 tb/d or 11.2% and jet fuel by 52.6 tb/d or 61.4%. The decline in gasoline imports reflects a weakness of demand. Product exports rose slightly in August to 2.4 mb/d, some 50 tb/d or 2.2% more than in the previous month and 0.4% or 10.3 tb/d lower than a year ago. Gasoline exports increased by 42.8% or 110 tb/d, whereas fuel oil and jet fuel declined by 4.6% and 4.1%, respectively.
As a result, US net oil imports declined in August to average around 8.7 mb/d, down 530 tb/d or nearly 5.7% from the previous month. Nevertheless, net oil imports remained almost 12.2% below the year ago level. The US imported around 4.5 mb/d from OPEC Member Countries in June, some 314 tb/d or 7.4% more than in May. This meant OPEC’s share in US crude oil imports stood at 49.5%. Canada remained the main supplier with 2.09 mb/d, followed by Saudi Arabia with 1.2 mb/d, then Mexico with 1.1 mb/d, Venezuela with 1.01 mb/d and Nigeria 0.81 mb/d. On the product side, US imports from OPEC Member Countries fell by around 30,000 b/d or 1% to average just 309 tb/d in June. This is the lowest level since the 300 tb/d recorded in June 2010 and corresponds to a share of 12.1% in total US product imports. Again, Canada and Russia remained the main suppliers, accounting for 17.2% and 13.9%, respectively, followed by Algeria with 7.2% and the Netherlands with 6.9%.
The downward trend in Japan’s crude oil imports stopped in July as an increase of 15.2% or 464 tb/d was observed. The increase pushed imports almost back to the level approaching 4 mb/d, which Japan experienced at the end of 2010. The regaining of infrastructure after the earthquake and tsunami in March helps explain the trend reversal, as does increased demand from refiners which are operational again and the demand from Japanese utilities for direct crude burning for power generation. Japan’s crude oil imports stood at an average of 3.5 mb/d in the first seven months of 2011 compared with last year’s 3.7 mb/d, a decrease of 170 tb/d or 4.6%.
Product imports, including LPG, edged up to 1.07 mb/d, which represents an increase of 19% or 170 tb/d compared to the month before, and up 13.5% or 127 tb/d on a y-o-y basis. Japans’s product imports stood at an average of 1.01 mb/d in the first seven months of 2011 compared with last year’s 0.95 mb/d. This represents an increase of 60 tb/d or 6.3%. Product exports increased slightly for the third consecutive month by 26 tb/d to average 0.59 mb/d. This is the highest level since February. As a result, Japan’s net oil imports in July increased to 4.0 mb/d, rising by 607 tb/d or 17.9% from June.
China’s crude oil imports declined in July for the third consecutive month, by 218 tb/d or 4.5%, to move further below 5 mb/d this year, the lowest level since the 3.9 mb/d recorded last October. Compared with a year ago, Chinese crude oil imports were 102 tb/d or 2.3% higher. The continuous decline can be attributed to the slowing growth in domestic crude refining, influenced by weaker demand from a cooling domestic economy. Similarly, product imports fell 3% or 32 tb/d compared to the last month, to around 1.02 mb/d; the lowest level since last October. Taken together, China’s crude oil and product imports in July showed a total drop of around 250 tb/d or 4.3% and an increase of 181 tb/d or 3.3% compared with a year earlier.
Despite the recent decline, China’s crude oil imports over the first seven months of 2011 showed an average increase of around 300 tb/d or 6.3%, remaining slightly above 5.0 mb/d compared to last year’s 4.7 mb/d. On the product side, there is a similar pattern. Product imports averaged around 1.1 mb/d in the first seven months of 2011, some 163 tb/d more than over the same period a year ago. This implies a combined growth in total oil of 500 tb/d in the first seven months of 2011 compared with last year’s levels. In July, Chinese crude oil exports declined by 20 tb/d to 47 tb/d, while product exports rose by almost 57 tb/d or 9.2% to 0.67 mb/d. Crude oil exports over the first seven months were around 52 tb/d or 13.6% above last year.
As a result, China’s total net oil imports fell a further 286 tb/d or 5.5% from the previous month to stand at 4.9 mb/d. This is the lowest level since 4.2 mb/d last October. The drop was attributed to crude oil net imports, which fell by 198 tb/d to 4.5 mb/d and product net imports which fell 88 tb/d or 20.4% to end July at 0.34 mb/d. Looking at the first seven months in 2011, China’s total net oil imports rose by 500 tb/d or 10% to a level of 5.6 mb/d. Saudi Arabia remained the main supplier of China’s crude oil imports in July with 0.98 mb/d, followed by Iran with 0.65 mb/d, Angola with 0.45 mb/d, Oman with 0.44 mb/d and Sudan with
India’s crude oil imports declined 146 tb/d or 4.4% in July, offsetting the increase of the month before, to stand at 3.21 mb/d, despite Indian refiners processing 3.9% more crude in July than a year ago. On the contrary, crude oil imports showed an increase of 2.6% on a y-o-y comparison. India’s crude oil imports in the firsts seven months of 2011 stood at 3.4 mb/d, some 282 tb/d or 9.1% higher than in the same period of the previous year. Product imports declined more rapidly by 16% or 60 tb/d to average 316 tb/d. Despitethis, India’s product imports remained above the 250 tb/d level of May. Compared with a year ago, July’s product imports were 34% lower. Diesel and gasoline were the main contributors to the decrease of around 94%, declining from 39.8 tb/d and 52.2 tb/d in June to 2.4 tb/d and 3.13 tb/d in July. Imports of LPG, naphtha and kerosene declined moderately to average 101.0 tb/d, 38.5 tb/d and 26.5 tb/d, respectively.
Fuel oil increased from 14.9 tb/d in June to 21.7 tb/d the following month. India’s product imports in the first seven months of the year stood at 342 tb/d, some 19 tb/d or 6.0% higher than in the same period of the previous year. On the export side, products increased slightly by 23.3 tb/d or 1.8% compared to the month before to stand at 1.28 mb/d, down from this year’s high of 1.43 mb/d in May. On a y-o-y basis, product exports increased by 8.1% in July 2011. As a result, India’s net oil imports decreased by 338 tb/d or 13.1% to average 2.244 mb/d in July to remain above this year’s low of 2.241 mb/d.
Total FSU crude exports continued to fall in July by 274 tb/d or 4.3% from the previous month. This can be mainly attributed to reduced supplies from Kazakhstan and Azerbaijan, caused by production and logistical problems. FSU exports by rail and sea were also down, reflecting a drop in the supplies of the CIS refineries. However, Transneft pipeline crude throughputs increased. Exports in the Transneft system were up by 115 tb/d to 4.06 mb/d following a reduction of supplies to domestic refineries and Kazakhstan’s 163 tb/d Pavlodar refinery. The latter cut imports due to scheduled maintenance. But this increase was not sufficient to offset the reduction in FSU crude exports to other destinations. Meanwhile, Transneft continues to carry out repairs to its Baltic Pipeline System as it prepares for the launch of the second stage of the route at the end of this year. As a result, Primorsk loadings were low during July. Shipments to Russia’s Novorossiysk increased by 190 tb/d from June to 895 tb/d in July as Russian companies redirected a proportion of the crude they would normally export from Primorsk to the Black Sea, along with the volumes that they would normally have supplied to Pavlodar.
Exports of FSU eastern and central European destinations along the Druzba pipeline were up by 71 tb/d or 6.4% from June to 1.17 mb/d in July. Deliveries of ESPO Blend crude to China and through to the Kozmino terminal on Russia’s Pacific coast were largely unchanged from last month at around 621 tb/d. Crude exports from Azerbaijan dropped during July as a result of scheduled maintenance at the Chirag production platform and maintenance along the Baku-Supsa pipeline, which was carried out during the second half of the month. Loadings from the Georgian port of Supsa decreased, while exports along the Baku-Tbilisi-Ceyhan (BTC) pipline, and then out through the Turkish port of Ceyhan, were down by 105 tb/d to 690 tb/d.
Pipeline exports of CPC Blend were down marginally by 22 tb/d from June to 658 tb/d last month. Exports of crude produced by the Lukoil-ConocoPhillips joint venture from Lukoil’s Varandey terminal were down by 5.4 tb/d to 81 tb/d, reflecting the declining production rates of Naryanmarneftegaz. Product exports from the FSU fell by 8.5% or 257 tb/d to a level of 2.75 mb/d in July. Gasoline exports continued to fall, declining by almost half from the previous month, reflecting the fact that the export duty rate is still set by 90% of the crude duty rate as Russia tries to keep product in the country to avoid domestic shortages, observed in the last months. Naphtha exports, which are subject to the same punitive duty rate as gasoline, increased by 12.2% or 33 tb/d compared to last month to reach 303 tb/d. Exports of vacuum gasoil (VGO) were down by around 23% or 67 tb/d at 224 tb/d as refiners processed more of the product in a bid to produce more motor fuel.