China, India Cut West African Crude Imports as Demand Declines

News was prepared under the information support of Online Daily Newspaper on Hellenic and international Shipping "Hellenic Shipping News".

28 Nov 2008

Asian refiners cut West African crude oil imports for loading in December by as much as 27 percent after buyers led by China Petroleum & Chemical Corp. lowered purchases because of falling demand for fuels. China's imports will drop to between 420,000 barrels and 460,000 barrels a day from November's 570,000 barrels a day, according to five traders surveyed by Bloomberg. Indian Oil Corp. and refiners in the nation will cut purchases by 21 percent to about 280,000 barrels a day in December from November.
Asian oil-processing plants are reducing output as product prices have fallen faster than crude oil, lowering the profit to make gasoline and other fuels, after a global economic slowdown reduced consumption. China Petroleum, Asia's biggest refiner, cut crude oil processing by 10 percent this month from July's record, company officials said last week.
``Interest for West African grades were lower for December cargoes because of refinery run cuts and weak demand,'' said Vienna-based consultant JBC Energy GmbH.
Brent crude oil, a benchmark for Europe and Africa, has declined 63 percent from a record $147.50 a barrel on July 11. The contract for January settlement fell as much as 53 cents, or 1 percent, to $52.60 on London's ICE Futures Europe exchange today.
Asian refiners also pared West African imports for December as Far East crudes from Malaysia, Vietnam and Indonesia were relatively cheaper, JBC Energy said.
West African oil shipments in January to China may rise to 548,000 barrels a day in January, mainly because of increased refinery production, survey respondents said.
India has booked shipments of about 251,000 barrels a day for January, the traders said.
Most crude oil from West Africa is classified as light and sweet. They yield more gasoline, diesel and kerosene after processing compared with Middle Eastern varieties.

Source: Bloomberg