China's Oil Imports Set to Rebound Amid High Prices and Disrupted Middle East Flows

China's oil imports are set to rebound in the final quarter of the year, according to energy consultancies cited by Bloomberg. The country is expected to increase its crude oil imports by around 1.2 million barrels per day from the current level, but this will still be lower than pre-war levels.

The demand for oil has been weakened by high prices, with Brent crude trading above $93 per barrel and the OPEC basket at $91.27. Chinese refiners are also struggling to find suitable alternative supplies of medium sour crude after a significant reduction in Middle Eastern exports.

Analysts from Rystad Energy, Energy Aspects, and FGE NexantECA believe that oil purchases by Chinese refiners will climb back towards 10 million barrels daily by the end of the year, but may not reach this level until then. Fourth-quarter import rates could reach 9.9 million barrels daily.

Chinese buyers are also replacing Iranian barrels with Russian crude, with Kpler data showing that China is on track to import Russian crude at a rate of 1.25 million barrels daily. This would be down from 1.42 million barrels daily in July, but still a significant volume as Iranian oil imports slump to an estimated 340,000 barrels daily for August.

Energy Aspects analyst Jianan Sun noted that the prolonged war and Middle East flows still being disrupted are preventing larger demand drivers like stockpiling from taking place. 'With high crude prices, it's preventing larger demand drivers like stockpiling from taking place,' Sun said.