Published Date : Sep 22, 2015
The output of crude oil in China went up by 4.90 per cent to reach 18.3 million tons in the month of August 2015, in comparison with the year before. According to a report by the National Development and Reform Commission, the production of Chinese refined products went up by 3.70 per cent in August this year to reach 25.15 million tons from the previous year. The consumption of refined products in China reported an increase of 2.20 per cent last month to settle at 24.52 million tons compared to the numbers last year.
The agreement on increasing production will reduce the pace of imports of crude oil. On the other hand, increasing consumption could aid the prices of crude oil. Nevertheless, the downturn of the Chinese economy might pile onto the growing oversupply in the oil market.
The United States and China import an approximate of 15 million barrels of crude oil per day. Consequently, they account for an estimated 30 per cent of the overall consumption of crude oil in the world. According to data revealed by Chinese customs, compared to August of last year, import of crude oil in China dropped by 13 per cent last month to settle at 26.59 million tons.
The slump in the Chinese economy, the growing production of crude oil in China, and the reducing pace of import of crude oil in the country is estimated to add to the pressure on the global market for crude oil. In the same way, driving season in the peak of summer and seasonal maintenance of refineries are coming to an end and this is likely to restrict the average crude oil demand in the short run.
The gap between demand and supply has been widening and this is projected to add to the burden of producers of crude oil such as ConocoPhillips, Anadarko Petroleum, and Noble Energy