Russia overtook Saudi Arabia in 2016 to became China’s biggest crude oil supplier for the first year ever, customs data showed on Monday, boosted by robust demand from independent Chinese “teapot” refineries.
Russian shipments surged nearly a quarter over 2015 to about 1.05 million barrels per day (bpd), the data showed, with Saudi Arabia coming in a close second with 1.02 million bpd, up 0.9 per cent in 2016 versus the previous year. China is the world’s second-largest oil buyer and the fastest-growing major importer.
While Saudi Arabia counts China’s state oil firms as backbone clients over long-term supply contracts, China’s independent refineries – nicknamed “teapots” due to their smaller processing capacity – saw Russia as a more flexible supplier.
For the teapot plants, authorised to import crude oil importers for the first time in late 2015, shipments from Russia’s eastern ports are easier to process, coming in smaller cargo sizes from closer proximity.
For December, Russia also held the top spot with supplies up 4.8 percent from the same month a year earlier at 1.19 million bpd. Meanwhile Saudi December sales dropped nearly 20 percent from a year earlier to 841,820 bpd, data from the Chinese General Administration of Customs showed.
Total crude oil imports in December hit a record as refiners stepped up purchases ahead of a deal by oil-producing countries to reduce supply and bolster prices.
For the whole of 2016, imports gained nearly 910,000 bpd over 2015, the strongest annual growth on record.
Third-largest supplier Angola shipped 13 percent more crude last year versus 2015, while No.4 seller Iraq recorded similar growth.
China also boosted imports from South American producers last year, with growth of 37.6 percent from Brazil and 26 percent from Venezuela, the data showed.