The Organization of the Petroleum Exporting Countries in its April Monthly Oil Market Report (MOMR) said crude and product trade flows have been notably affected since the end of 2019 by the COVID-19 pandemic and the uncertain outlook amid measures to combat the spread of the virus which destroyed demand for refined products. In broad terms, The Far East region was impacted first by the disruption, followed by Europe, the US, and then India.
US crude exports increased by 0.8 million bpd year-on-year to 3.6 million bpd in the first quarter of 2020. Products imports surged 0.5 million bpd, or around 28% year-on-year, to an average of 2.2 million bpd in March, thanks to increasing gasoline imports. Product exports increased by 0.3 million bpd to 5.5 million bpd in March from the same month last year.
In January and February, China’s crude imports averaged 10.5 million bpd, declining by 0.2 million bpd from December, as disruptions caused by the COVID-19 outbreak Chinese importers to divert or delay shipments. Product trade was also affected, with imports averaging 1.2 million bpd in the first two months of the year, 0.2 million bpd or 7% lower compared to the same period last year, as domestic demand fell significantly. Meanwhile, product exports fell from a peak of 1.9 million bpd reached in November 2019 to 1.6 million bpd in January-February as refinery runs were substantially lower.
India’s crude imports increased by 0.2 million bpd or around 5% year-on-year to 4.7 million bpd in February as the country took in some discounted cargoes diverted from China. Product imports were 0.1 million bpd or almost 9% higher from a year earlier at 1.1 million bpd in February supported by continued strength in LPG demand. Meanwhile, product exports increased by 0.2 million bpd or 17% year-on-year to 1.3 million bpd. The 21-day national lockdown to combat the spread of COVID-19 is likely to affect India’s crude and product trade in March.
Japan’s crude imports fell by 221,000 bpd or 7% year-on-year to 2.9 million bpd in February for the second consecutive month amid lower refinery runs and weak product demand overall in the Asian region. Product imports averaged 0.9 million bpd in February, representing a 118,000 bpd or 11% month-on-month decline. Meanwhile, product exports averaged 654,000 bpd in February, increasing by 16% from January.
Trade flows are likely to keep fluctuating over the next couple of months as measures to fight the pandemic continue to impact demand for oil product imports, especially transportation fuels. On the crude side, persistently low refinery throughput will weigh on crude imports. The collective supply cut by major oil producers is expected to have a considerable impact on crude trade flows from May onwards.
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Published on April 17, 2020 5:53 PM (GMT+8)Last Updated on April 17, 2020 5:53 PM (GMT+8)
