(Adds detail of new Saudi oilfield, background)
By Chen Aizhu
BEIJING Dec 17 China has agreed to boost crude
oil imports from Saudi Arabia by over a third next year, two
Beijing-based trading sources said on Monday, helping fuel new
refineries in the world's second-biggest consumer.
Saudi Arabia, the world's biggest oil exporter, will sell
Sinopec Corp (0386.HK) and PetroChina (0857.HK) about 200,000
barrels per day (bpd), or 38 percent more crude in 2008 than
this year, equal to about a tenth of China's total oil
The deal comes just days after confirmation that China will
also boost imports from Iran by a third, both signs of
Beijing's desire to strengthen ties with major OPEC producers
to ensure a steady flow of oil to keep its economy humming.
The deal also gives Saudi Arabia a growing share of the
vast Chinese oil market ahead of the commissioning next year of
a new 160,000-bpd refinery in Fujian province in which
state-run Saudi Aramco and U.S. giant Exxon Mobil Corp (XOM.N)
each own 25 percent, the kingdom's first such investment in
The agreed 2008 volume will lift imports to about 720,000
bpd, although that is still only about half as much crude as
sold to Japan or the United States, the two biggest customers
for Saudi Arabia's 7 million bpd of exports.
"It's an increase of 10 million tonnes from this year," one
of the sources told Reuters on condition of anonymity. In the
first 10 months of this year China imported about 520,000 bpd
of Saudi oil, official customs data showed.
The increased Saudi supplies would mostly be of medium and
heavy grades, the traders said.
Top refiner Sinopec, which is more dependent on imports
than PetroChina, had asked for a 30 percent increase in its
Saudi oil imports for next year, a trading source told Reuters
A growing share of China's demand for imported oil is being
met through long-term contracts, reducing its demand for spot
crude and potentially tempering its impact on world markets.
Saudi Arabia has also made clear it is counting on rising
demand from expanding Asian economies to justify the tens of
billions of dollars it is spending to increase its output
capacity to 12.5 million bpd from 11.3 million bpd.
A fresh 500,000 bpd of capacity is due to be added this
month at the Khursaniyah project near the Gulf.
China is forecast to log an annual fuel demand growth of
more than 5 percent this year to 7.5 million bpd, the
International Eenergy Agency said in its latest monthly report,
powered by an economy set to surge by 11.5 percent this year.
On top of the refinery in Fujian, Aramco has also been
trying to get a share in Sinopec Corp's new 200,000-bpd oil
plant in east China's Shandong province that is designed to
process high-sulphur Saudi crude, industry officials have