New | China crude output drop to inspire spike in imports

China’s crude oil imports may rise further in the coming months as tumbling domestic output leaves refiners looking overseas for supplies, helping ease a persistent global glut.

Imports by the world’s second-biggest consumer may extend last month’s rebound as the country’s oil processors come out of their peak maintenance season, while domestic output falls further after sliding to the lowest in more than six years, according to analysts from Natixis SA and Energy Aspects Ltd.

“The extent of decline in crude production is quite astonishing,” Michal Meidan, a London-based analyst with Energy Aspects, said by phone. “Naturally, such a gap in supply will be partly made up with imports.”

Production in August dropped 9.9 per cent from a year ago to about 3.89 million barrels a day, the lowest since December 2009, according to Bloomberg calculations of National Bureau of Statistics data released Tuesday. Output is down 5.7 per cent during the first eight months of the year.

China, which was the world’s fifth-biggest producer last year, has been pumping less as state-run companies shut fields too expensive to operate after prices fell earlier this year to the lowest since 2003. The country is forecast to lead production declines across Asia, forcing the world’s largest-consuming region to rely more on overseas supplies.

The impact of rising Chinese imports on the global oversupply could be muted as stockpiles are seen continuing to accumulate, and the surplus is seen persisting into late 2017, the International Energy Agency said Tuesday.