Summary

Preliminary data shows US crude imports declined for the second month in a row but remained at a strong 6.3 mb/d in August. US crude exports averaged just under 3.0 mb/d in August, after falling to 2.7 mb/d the month before, amid renewed interest by Indian buyers. US product imports rose m-o-m to a robust 2.6 mb/d, while product exports slipped for a second month to average a still healthy 5.3 mb/d. With the US Gulf region hit hard by Hurricane Ida, crude and product exports, and to a lesser extent crude imports, are likely to be impacted in September.

China’s crude imports have remained relatively flat since April, averaging 9.7 mb/d in July, amid lower imports from independent refineries as well as port disruptions due to storms. Product imports in July also fell back from the previous month’s levels, while product exports declined to a 10-month low, averaging 1.2 mb/d, as gasoline, diesel and jet fuel outflows plunged. Preliminary data for August shows China’s crude imports rebounding to 10.49 mb/d and a further decline in product exports, amid what seems to be an emerging government policy of limiting excess refinery activity.

India’s crude imports continued to decline m-o-m in July, reaching a 12-month low of 3.6 mb/d amid unplanned outages and limited refinery runs. Product imports edged higher, led by a strong jump in fuel oil, which offset declines in naphtha and kerosene. Product exports fell for the second month in a row, with declines across most major products except fuel oil. With state-owned refiners are looking to increase runs to maximum capacity in the coming months, crude imports are expected to turn higher in the coming months, potentially leaving July figures as the lowest for this year.

Japan’s crude imports recovered from the historically weak performance seen the month before to average 2.1 mb/d in July, as the Tokyo Olympics held 23 July-8 August provided limited support due to COVID-19 safeguards. Product imports, including LPG, were broadly unchanged m-o-m at 0.9 mb/d, while product exports continued to show strong m-o-m gains, due to higher outflows of jet fuel and gasoil. With the state of emergency extended until the end of September, crude imports are likely to remain relatively flat and the timing of any recovery toward pre-COVID levels remains uncertain.

The latest data shows OECD Europe crude imports hit a 14-month high in May, averaging 8.6 mb/d, amid higher inflows from the US and Nigeria. Crude exports fell sharply to the lowest since October 2019, averaging 0.3 mb/d in May, amid reduced flows to Asia. More recent data shows crude imports strengthening slightly in July and August. OECD crude exports are expected to remain weak over the same period, with reports of increased Asia buying of North Sea grades only in September.