In a bullish oil market, where the price of the global benchmark Brent crude increased by almost 40 percent since June, the bears are feeling a bit energized with the fact that China’s crude imports have declined to the lowest in 12 months because India and China have been the biggest drivers of demand growth this year.
The chart shows China’s monthly oil market imports for 2016 and 2017 (kindly note, all numbers are approximated to nearest decimal). According to customs data, in October, China imported 7.33 million barrels of oil per day, lowest since October 2016, when it imported around 6.8 million barrels per day. Until October, China in 2017 imported around 8.53 million barrels per day. October decline brought down the average to 841 million barrels per day, which is still higher by more than 10 percent compared to the 2016 average when it imported around 7.63 million barrels per day.
While one month’s decline is likely to be ignored by the bullish market, but if sustained, any major decline would cast a bearish shadow over oil price in 2018. WTI is currently trading at $56.9 per barrel and Brent at $6.7 per barrel.
