China's annual imports of crude oil reached an unprecedented high in 2023, marking a significant recovery in fuel demand from the post-pandemic decline. According to data from the General Administration of Customs (GACC), China imported 563.99 million metric tonnes of oil last year, equivalent to an average of 11.28 million barrels per day, representing an 11% increase from 2022.
The remarkable surge in crude oil imports was attributed to the country's rebounding fuel demand as it emerged from strict pandemic restrictions at the end of 2022. Domestic transportation experienced a surge in activity, with highway traffic, measured in passenger kilometers, witnessing a 43.6% jump between January and November. While domestic air travel quickly recovered, reaching record highs in December, international travel struggled to bounce back.
Despite record imports, analysts anticipate a slowdown in China's oil demand growth by approximately 4% in the first half of this year, primarily influenced by uncertainties in the construction and manufacturing sectors due to a property market slump.
Key drivers for oil imports in 2024 are expected to come from aviation's demand for kerosene and the petrochemical sector's need for products used in the manufacture of essential goods like solar panels and electric vehicles.
The surge in foreign interest in China's oil markets was notable in 2023, with Brazilian state-owned oil company Petrobras announcing plans to establish a subsidiary in China. This move is part of efforts to triple Brazil's share in China's oil imports over the next few decades.
Additionally, China's natural gas imports, including liquefied natural gas and piped gas, rose by 9.9% year-on-year, reaching an almost-record 119.97 million tonnes for 2023—the highest gas import figures ever.
Recent developments also highlighted China's ongoing negotiations with Russian energy companies for the development of oil and gas fields, underscoring the nation's strategic focus on energy security and collaboration.
However, trade between China and Iran faced challenges as Tehran ceased shipments, seeking higher prices from Beijing. Iranian oil, accounting for about 10% of China's total crude imports, played a significant role in the complex dynamics of global oil trade.
The unprecedented figures in China's crude oil and natural gas imports affirm the nation's resilience and strategic position in the global energy landscape, shaping the trajectory of international trade and cooperation in the sector.