by Bloomberg, via RigZone.com|Bloomberg News | Oil imports into China sank again last month, highlighting soft consumption in the largest buyer just as traders weighed the implications of Donald Trump capturing the White House and potential supply rises from OPEC+.
According to customs data from Thursday, imports contracted to 44.7 million tons in October. That’s about 2 percent lower than September, and almost 9 percent below the same period last year, according to Bloomberg calculations. Year-to-date shipments are now running more than 3 percent behind last year’s pace.
Crude prices are lower year-to-date despite tensions in the Middle East, with US output running at a record rate, and OPEC+ planning to ease supply curbs. China’s consumption has been a weak spot for the market, and last month’s decline in inflows came as local refiners cut throughput amid weaker margins. Trump’s victory has prompted speculation it’s negative for prices.
State-owned refineries in the Asian nation cut their run rates at the end of October to the lowest since December, according to data from Mysteel OilChem. More than half of 60 state-owned plants surveyed by the industry consultant were seen to have curtailed operations in the period.
The roots of the slowdown in oil imports lie in the wider economy’s sluggish performance, with policymakers grappling with a drawn-out property crisis despite several round of stimulus. In addition, more of the nation’s trucking fleet has been switching away from diesel to liquefied natural gas.
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U.S. Rig Count Unchanged for Third Consecutive Week
U.S. energy firms held the oil and gas rig count steady at 585 for a third consecutive week, according to Baker Hughes’ data as of November 8. This keeps the total count down 31 rigs, or 5%, from the same time last year. Oil rigs remained at 479, while gas rigs held at 102.
The U.S. rig count declined 20% in 2023 amid falling energy prices, inflation-related costs, and a focus on debt reduction over production growth. Crude futures are down 2% year-to-date, while gas futures are up 6% after significant declines last year. Despite this, U.S. crude output is expected to grow from a record 12.9 million barrels per day (bpd) in 2023 to 13.2 million bpd in 2024 and 13.5 million bpd in 2025, per the EIA. Meanwhile, gas output is projected to dip to 103.5 billion cubic feet per day in 2024 from 2023’s record high of 103.8 bcfd.
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