China imported more Crude Oil from Saudi Arabia and Iran – Commerzbank

FXStreet Insights Team FXStreet

China boosted crude imports from Saudi Arabia and Iran in November, while Russian volumes declined amid weak demand and newly imposed U.S. sanctions. Independent refiners are turning to discounted Iranian crude after receiving fresh quotas, a shift that may deepen the pressure on Russian supply, Commerzbank's commodity analyst Carsten Fritsch notes.

Iranian Crude flows rise, Russian volumes slip

"According to Kpler, China's Crude Oil imports from Saudi Arabia rose to a five-month high of 1.59 million barrels per day, and those from Iran to a three-month high of 1.35 million barrels per day. In contrast, seaborne imports from Russia fell to 1.19 million barrels per day."

"This is attributed to lower procurement volumes by state-owned refineries, while import quotas on the part of independent refineries were virtually used up. This may therefore be an indication that the US sanctions against Russia's two largest Oil companies, which came into force two and a half weeks ago, are already having a first effect."

"China will publish official data on the origin of imports at the end of next week. According to a Reuters report citing trading sources and analysts, independent refineries have recently been buying Iranian Oil at steep discounts from onshore storage facilities after being granted new import quotas. By contrast, demand for Russian Oil is said to have remained weak."

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