China’s May Iran oil imports down 31.6 percent on year: customs

China’s crude oil imports from Iran fell in May to their lowest levels in four months, official customs data showed on Tuesday, as overall crude imports dropped during the traditional maintenance season.

China’s imports from Iran were 2.20 million tonnes last month, or 518,400 barrels per day (bpd), down 26.7 percent from April’s 707,400 bpd and down 31.6 percent on the year.

An explosion in early April at Dragon Aromatics, an independent petrochemical producer in eastern China that handles condensate like that exported by Iran, could have contributed to the May drop.

Thomson Reuters Oil Research & Forecasts had put its latest estimate of China’s imports from Iran in May at 593,400 bpd. The group expects volume from Iran to fall in June to 506,100 bpd.

It appears likely that a deal will be clinched to restrict Iran’s nuclear program in exchange for sanctions relief some time around the deadline set for June 30, which would allow Iran to ramp up exports.

Iran, once OPEC’s No.2 producer after Saudi Arabia, hopes to boost crude exports by as much as 1 million bpd if Tehran and six major powers finalize the nuclear agreement.

It is now holding up to 40 million barrels of oil on supertankers at sea preparing for a sales drive once a nuclear pact is sealed.

For the first five months of the year, China, Iran’s largest oil client, brought in 11.85 million tonnes of crude oil, or 573,100 bpd, down 11.4 percent from the year-earlier period, the customs data showed, but still above the 2014 average of roughly 555,000 bpd. [O/CHINA1]

Chinese companies have contracted to lift slightly more than 600,000 bpd of Iranian oil this year, including an annual condensate supply deal with an independent petrochemical maker that runs from August.

China’s crude oil import data includes condensate, a very light oil normally used as a petrochemical feedstock.

China’s total crude oil imports fell 11 percent in May from a year earlier to their lowest levels since October 2013, as more plants entered planned maintenance and companies drew on stocks following the previous month’s record purchases.

Crude imports from Saudi Arabia fell 18.1 percent in May to 719,100 bpd, while Russian imports surged 33 percent to 923,400 bpd, making it China’s largest supplier last month.

By Reuters