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China’s imports of IOTCO oil to hit record high

Oil market sources say they expect to see China’s imports of crude oil from Iran to surge to a record high in 2017.

China’s imports of IOTCO oil to hit record high
(Friday, January 20, 2017) 06:46
Reuters in a report quoted senior industry and trading sources as saying that Chinese firms were expected to lift between 3 million to 4 million barrels more Iranian oil each quarter in 2017 than last year.

That would be about 5 percent to 7 percent higher than the 620,000 barrels per day (bpd) of Iranian crude the country has imported during the first 11 months of 2016, according to the customs data.

China's demand for foreign crude could touch new highs as state-run refiners start up new plants and as Beijing allows more independent refiners to import crude, with the country forecast to remain a key driver of 2017 demand growth, Reuters added.

State refiner Sinopec Corp and state-run oil trader Zhuhai Zhenrong Corp, the two biggest Chinese lifters of Iran's oil, are set to roll over annual supply agreements with National Iranian Oil Company (NIOC), with combined volumes of about 505,000 bpd, two sources with knowledge of the agreements said.

Additionally, China National Petroleum Corp (CNPC) and Sinopec expect to lift more oil this year from two oilfields they operate under service contracts, Reuters added quoting sources with close knowledge of the agreements as saying.

A separate senior trading source estimated that Sinopec could lift about 4 million barrels of crude from Iran every quarter this year. The source added that the supplies for Sinopec will be provided from Iran’s Yadavaran oil field.

Also, another source told Reuters that CNPC is expected to lift an average of about 3 million barrels from Iran’s North Azadegan each quarter.
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