China Gulf Oil Imports Forecast to Near Pre-War High as Shipments Rebound

Chinese crude oil imports from the Gulf region are rebounding following months of shipping disruption and a sharp contraction in domestic inventories. According to Chinese customs data, shipments from the Middle East increased 25.7 per cent month on month to 13.8 million tonnes in September, marking a third consecutive monthly rise.

Xu Muyu, a senior crude oil analyst at data intelligence firm Kpler, stated that demand for Middle Eastern crude is likely to remain robust due to record domestic stock drawdowns. Chinese refiners have been actively bidding for crude supplies from Abu Dhabi and Iraq through spot tenders, while also increasing purchases of Saudi crude amid competitive pricing strategies and higher regional allocations.

Kpler forecasts that China's oil imports from the Middle East are on track to exceed 5 million barrels per day in October. This would mark a sharp increase from 3.5 million barrels per day in September and approach the pre-war level of 5.6 million barrels per day recorded in February.

To preserve export competitiveness as shipping disruptions through the Strait of Hormuz and the Red Sea inflate freight rates, several regional producers, including Saudi Arabia and Iraq, have lowered their official crude prices for Asian buyers. Saudi Arabia has also restored operations along its East-West pipeline following attacks by Yemen's Houthi group.

Meanwhile, Kpler data indicates that China's onshore crude inventories dropped at a record pace of approximately 1.6 million barrels per day in September, with the drawdown rate subsequently moderating to around 400,000 barrels per day in October.