July 10, 2012 / 8:26 AM / 6 years ago

UPDATE 3-China June crude imports lowest since Dec

* June imports at 5.29 mln bpd, lowest daily rate since Dec

* June imports down 12 pct on mth, up 10.3 pct on yr

* H1 imports up 11 pct to 5.62 mln bpd (Adds details)

By Judy Hua and David Stanway

BEIJING, July 10 (Reuters) - China’s crude imports plunged in June to their lowest daily rate since December, coming off a record high in May, customs data showed, as refiners cut imports amid slowing oil demand in the world’s second-largest oil consumer and crude buyer.

Demand growth in China is one of the biggest drivers of global crude markets. However, in April, oil demand in China posted its first yearly fall in at least three years and edged up just 0.8 percent in May as economic growth slowed.

“The high crude imports in May didn’t match the actual demand from refineries, resulting in high inventories. Refiners have to cut imports from June,” said a Beijing-based oil analyst.

“Commercially, refiners have no motivation to import more crude as they are cutting crude runs. Strategically, we have not seen any new state storage put into operation recently. So I don’t think crude imports will rebound quickly.”

Crude imports in June were 5.29 million barrels per day (bpd), up 10.3 percent from a year earlier, customs data showed.

June imports were 12 percent, or around 710,000 bpd, lower than the record 6.0 million bpd imports in May.

For the first half of this year, crude imports rose 11 percent on the year to 5.62 million bpd, the data showed.

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POLL-Global oil demand at slowest since 2008

POLL-China refineries cut July throughput

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SLOWING DEMAND

“Oil demand slowed down rapidly after the government started cutting fuel prices in May. This seems to be a vicious circle: cutting fuel prices, demand falls; demand falls, fuel prices down,” said a Chinese crude trader.

Lower fuel prices squeezed refining margins and led refiners to supply less fuel, thus reducing demand for crude, the trader added.

China is set to lower gasoline and diesel retail prices from Wednesday, its the third cut in just over two months.

To trim high domestic fuel inventories, top Asian refinery Sinopec Corp cut its crude throughput by more than 243,000 bpd in June from an earlier output target, and cut throughput by some 236,000 bpd below target in July industry sources have said.

As a result, Sinopec will lift less crude oil from Saudi Arabia and Kuwait against their contract volumes for its July loading programmes, traders have said. Its July-lifting Iranian cargoes are also at risk of delay due to a dispute between Sinopec and the Iranian shipper.

Sinopec will keep lifting less crude oil from Saudi Arabia for August because of refinery maintenance, although the cuts will be less than those for July.

Imports of oil products fell 15.6 percent to 2.93 million tonnes while exports of oil products fell 0.5 percent to 2.07 million, leaving net fuel imports at 860,000 tonnes, customs data showed. (1 tonne=7.3 barrels) (Reporting by Judy Hua and David Stanway; Editing by Clarence Fernandez)

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