The crude oil market saw an unexpected boost as Chinese refiners increased their purchases of Middle Eastern oil despite continuing concerns about the country’s demand outlook.

Spot purchases of benchmark crude from the Middle East, scheduled to arrive in China in September and October, increased, driven by the activity of giant companies such as Unipec and PetroChina.

This increase in demand is due to the return of government refineries to work after maintenance operations and the addition of a new private refinery to production, as well as expectations of increased purchases of the country’s strategic reserves.

China is the world’s largest importer of crude oil, and its demand plays a pivotal role in determining global prices.

But with China’s economy slowing this year amid the real estate crisis and declining consumer confidence, crude oil flows have seen a decline since the beginning of 2024 compared to last year.
Current purchasing patterns provide positive indications of a possible recovery in demand soon as China focuses on boosting its oil inventories.

According to Jianan Sun, an analyst at Energy Aspects, spot purchases appear strong, with China focusing on buying Middle Eastern oil in the current buying cycle.

The strength of Middle East oil is also due to its lower prices compared to global Brent crude, as barrels linked to Dubai crude, such as those coming from the United Arab Emirates and Qatar, have become cheaper in the spot market. In general, Chinese refineries’ purchases of Middle Eastern oil provide a positive boost to the crude market, which contributes to the stability of global prices despite the global economic challenges.