China oil demand rebound?

China’s oil demand in May rose for a second month in a row, year-on-year, according to Platts’ analysis of official data – the second highest level ever. It followed an increase in April that was the first in six months.

The analysis is based on Chinese official figures, which do not explicitly cover consumption, so it doesn’t preclude factors such as building reserves, or restocking, which the latest monthly IEA report pointed to.

China’s own crude output fell 1 per cent in the month, which Platts says is affecting international trade:

“Falling crude oil production in China means its rebounding demand is having a disproportionally large affect on international oil trading. China imported 17.09 million metric tons — about 4 million barrels a day of crude oil last month. That was the second highest month of crude oil imports into China, ever,” said Dave Ernsberger, senior editorial director for Asia at Platts.

However Platts’ Oil Drum blog points out that in May last year China was building big stocks of diesel, making this year’s gain more notable.

Related links:

Platts media release: China oil demand jumps for second consecutive month
China’s reserves: another explanation for stronger oil prices
(22/05/09)

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