China July crude imports in biggest fall since Jan 05

BEIJING (Reuters) – China’s crude imports unexpectedly fell 7 percent in July to a seven-month low, its steepest monthly drop since January 2005 as refiners balked at soaring crude costs amid lagging domestic fuel prices.

The July decline follows a weak 3 percent rise in June imports at a time of mounting concern that the U.S. economic slow-down is taking a bigger than expected toll on other markets, potentially undercutting oil use in the world’s No. 2 consumer and weighing on world prices still partly buoyed by Asian demand.


Imports could rebound if the fall was due to refiners drawing down crude stocks, but some analysts warned it could be an early signal of lacklustre end-user demand that actually caused an unusually large build-up in inventories earlier in the year.

“We believe first-half crude stocks have risen much faster than a year ago, together with inventories of gasoline and diesel,” said Yan Kefeng, a senior Beijing-based analyst with Cambridge Energy Research Associates who closely tracks China’s rarely reported oil inventory data.

“We are likely to see fuel imports slowing in the coming months.”

Reuters