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China's oil imports fall to lowest since 2016
Economy
The world's largest oil importer will purchase even less crude this month, reflecting exceptionally weak demand that has persisted since the start of the Middle East war.
China's seaborne oil imports in June will average about 6.4 million barrels per day, according to preliminary data from analytics firm Kpler. This is the lowest since October 2016 and about 8% lower than in May. Vortexa's supply tracking data shows a similar trend.
Since the start of the war in Iran in late February, China has reduced its purchases by about 4 million barrels per day relative to its normal level. This unexpected decline helped balance global supply and demand and keep prices below $100 per barrel.
Now that the US-Iran ceasefire has allowed partial resumption of shipments through the Strait of Hormuz, attention is shifting to when China's oil demand might recover. Beijing compensated for the colossal supply shock by limiting petroleum product exports, reducing refinery utilization, and drawing down commercial stockpiles. However, a weak economy and the accelerating shift to electric vehicles, which will likely lead to a permanent loss of demand, have reduced the country's oil demand, and analysts warn that this situation could persist for months.