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208 comments on DrumBeat: November 11, 2008

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Pitt the Elder on November 11, 2008 - 11:54am Permalink | Subthread | Parent | Comments top

China oil imports up 28.2% YOY

Highly misleading.

Import volumes can change significantly month-to-month, which is why only aggregated data is reliable. Based on EIA numbers, China's 2Q08 demand was 7.94Mb/d vs. 7.52Mb/d in 2007, or a more modest 5.6% higher. Production over the same periods was 3.82Mb/d vs. 3.79Mb/d, or 0.8% higher. Total difference in imports was 4.8% for 2Q08 over 2Q07, and also very close to that for 1H08 over 1H07.

Imports may be up 28% this October over last October, but that's almost certainly nothing more than noise in the data. The trend is a 5% increase in imports, or about 0.2Mb/d. The IEA analysis confirms that expected growth in Chinese petroleum consumption is 5-6% in each of 2008 and 2009.

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eastender on November 11, 2008 - 12:00pm Permalink | Subthread | Parent | Comments top

You say:

The trend is a 5% increase in imports

Platts says:

In the first 10 months of this year, China's crude imports reached 151.15 million mt (3.65 million b/d), an increase of 10.6% over 136.67 million mt (3.67 million b/d) in the same 2007 period, according to the customs figures.

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Pitt the Elder on November 11, 2008 - 9:19pm Permalink | Subthread | Parent | Comments top

The trend is a 5% increase in imports

Typo on my part; I'd been talking about demand increase, but accidentally switched to typing "imports" in the middle. Thanks for catching that; my mistake.

To reiterate: the trend is that China's demand is growing at about 5%/year. As the country produces about half of the oil it consumes, their imports are growing at about 10% per year, far below the 28% that BrianT was implying.

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el zorro on November 12, 2008 - 2:07am Permalink | Subthread | Parent | Comments top

Just to correct the arithmetic...

If consumption increases by 5.6%, and production increases by 0.8%, this does not imply that imports increased by (5.6 - 0.8) = 4.8%
In fact, imports will increase by a percentage much higher than the percentage increase in consumption. The proper calculation for the increase is:

change in imports = (current consumption - current production) / (previous consumption - previous production)

In this case, this is (7.94 - 3.82) / (7.52 - 3.79) = 10.5%

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elwoodelmore on November 12, 2008 - 8:38am Permalink | Subthread | Parent | Comments top

i propose ((7.94-3.82)-(7.52-3.70))/(7.94-3.82)= 0.095 = 9.5 %

or (4.12-3.73)/4.12 = 9.5%

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eastender on November 12, 2008 - 2:48am Permalink | Subthread | Parent | Comments top

No prob, it happens to even the best of us some of the time. ;-)

The remarkable thing here (i.e.: the story behind the story) is this:

July imports were 8% lower than the average of the 3 months before July and 12% lower than that of the 3 months after July. In other words: consumption in China is not slowing one bit, financial turmoil and deteriorating economies elsewhere notwithstanding.

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rainsong on November 12, 2008 - 7:57am Permalink | Subthread | Parent | Comments top

Check eastenders math in reporting the Platts story. It would not pass with a Certified Public Accountant.

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208 comments on DrumBeat: November 11, 2008

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