China’s petroleum net imports up 16% in 2010

Due to a surge of crude oil imports, China’s petroleum net imports rose 16% in 2010 to 254 million metric tons. China’s reliance on crude oil imports has been higher in 2010 due to the demand for fuel and newly added refining capacity. Domestic output of crude oil was far behind market demand. Estimates place the net imports of crude oil at 60% of the projected petroleum consumption for 2010. In 2011, Chinese banks are likely to tighten credit, which is expected to reduce fuel demand from the construction industry, but the demand from transportation and industry generally should continue to maintain stable growth. This suggests China’s crude oil imports may reach a new high in 2011. Crude run rose by 13.4% year-on-year to 50 million tons due to robust demand and increased refining capacity. Sudden growth in demand in the fourth quarter pushed yearly sales of seven key oil products including gasoline, kerosene, diesel fuel, lubricating oil, fuel oil, LPG, and chemical oil up by 16%. It is estimated that China’s real consumption of oil products in 2010 have risen by 9.5% over 2009’s 383.9 million tons, after deducting state and commercial reserves of crude oil and oil products. If so, the growth rate in 2010 is the fastest since 2004 and the rate of petroleum imports, which stood at 253.7 million tons in 2010, rose by 60% from the previous year’s 57%. (February 21, 2011)