China's surplus of crude oil inventories rose in April due to lower refinery output

According to estimates by Clyde Russell from Reuters, China's oversupply of crude oil rose to 1.89 million barrels per day in April. That surpasses the March figure of 1.74 million and marks the highest level since June 2023.

China does not publish official statistics on inventories, but the approximate amount can be estimated based on data on supplies from abroad, refining volumes, and domestic production.

Russell attributes the increase in the estimated figure to China's intensive purchases of discounted cargoes from countries subject to restrictions. Also, a decrease in the volume of production at the country's oil refineries contributed to the growth of stocks.

According to official data, in April, refineries in China processed 14.12 million barrels per day. This is 1.4% less than a year earlier and less than the March figure of 14.85 million.

As Russell notes, the actual volume of surplus oil in China may be less because of the output of some enterprises that are not reflected in the official statistics. Nevertheless, he emphasizes that China's oil purchases over the last two months are far above the country's actual level of demand for crude.