The renewal of China's import pact is also good news for
Iran because its second-biggest oil buyer, India, is locked in a payment
dispute with Iran over the south Asian nation's crude imports of around 400,000
bpd and as Japan has scaled back further Iranian oil buys.
Two sources with direct knowledge of the deals said
Chinese state trader Zhuhai Zhenrong Corp., which buys more Iranian crude than
any other company, had agreed with National Iranian Oil Co. (NIOC) to buy
240,000 barrels per day in 2011.
Sinopec Corp., Asia's top refiner and the country's
ultimate dominant processor of Iranian oil, separately agreed to take 220,000
bpd of oil from NIOC for this year, a volume steady with last year.
"No change in volume, no change in the grades of oil
supplies. All is the same as last year," said the source, referring to the
Zhenrong-NIOC agreement.
However, as China, the world's biggest oil user after the
United States, looks poised to raise its total crude imports at double-digit
pace this year, a flat Iranian volume means Iran's share in China's oil
purchases will become smaller.
China has been raising imports from Saudi Arabia, the
world's No.1 oil exporter, and also from West Africa's Angola and more
recently, Latin American suppliers Venezuela and Brazil, both of which were
spurred by massive loan-for-oil deals Beijing signed up in 2009.
China's government this month gave environmental clearance
to Venezuela's first refinery in China, paving the way for final state approval
for the $8.7 billion venture which will process oil from the Latin American
exporter.
Beijing's state oil traders have all along said
unattractive prices for the relatively poor quality Iranian oil were to blame
for the deep import cuts recorded in the first half of 2010, a factor that
outweighed political pressure from a fourth round of UN sanctions slapped on
Iran in June for its nuclear activity.
Iran supplied about 9 percent of China's total crude
imports last year when total Chinese crude purchases surged 17.5 percent,
shrinking from a figure of 11.3 percent in the previous year, Chinese customs
data showed.
China, already importing close to 55 percent of the crude
oil it refines, is forecast to raise imports to 8 million bpd in 2020,
two-thirds more than it imported last year, top energy firm CNPC's research arm
said on Thursday.
Unless Iran makes its oil prices more attractive versus
competing supplies from the rest of the Middle East or South American
exporters, it may be hard for the OPEC member to boost its share in the rapidly
expanding Chinese market.
China's Iranian crude imports fell by nearly a third in
the first half of 2010 from the year-earlier level, but started to claw back
the third spot since June.
Zhuhai Zhenrong supplies the bulk of the 240,000-bpd oil
to refineries run by Sinopec Corp. and a small amount of roughly 20,000 bpd to
PetroChina, China's second-largest refiner.
Meanwhile, China's commercial crude oil stocks inched up
0.5 percent at the end of December from end-November, the first increase after
three consecutive falls, a newsletter run by the official Xinhua News Agency
showed on Friday.
That suggests that Chinese refiners had to source crude
oil from somewhere beyond commercial tanks last month as their record
throughput in December was more than what was imported and produced
domestically during the same month.
Inventories of refined oil products at the end of
December increased 8.7 percent from a month earlier, the China Oil, Gas and
Petrochemical reported.
Of the total, diesel stocks soared 16 percent on the
month, while gasoline stocks rose 3 percent and kerosene stocks gained 5.6
percent.
The buildup in fuel stocks, the second in a row after
eight months of drawdowns, indicated refiners continued to replenish their fuel
storage tanks, suggesting China's real oil demand might not be as strong as
headline figures showed.
China's
apparent oil demand increased 19.1 percent on year in December to a record 9.65
million barrels per day, Reuters calculation showed.
