Page 7 - AsiaElec Week 21 2022

AsiaElec COAL AsiaElec

GAC data show Chinese

spending on Russian oil,

gas, coal up 75% in April

CHINA CHINESE spending on Russian crude oil, natu- domestic energy demand in light of COVID-re-
ral gas and coal jumped by more than 75% year lated shutdowns. Even so, China did buy 1.71mn
on year to $6.42bn in April, according to data tonnes of Russian coking coal, up by more than
released on Friday, 20 April 20 by the General 100% y/y and marking the third straight month
Administration of Customs (GAC). of increases, as steel mills stocked up in the
The GAC data did not provide a full break- expectation that government spending was set
down of spending on Russian fuels. However, it to rise.
did indicate that Chinese buyers had imported The GAC data was published around the
6.55mn tonnes (1.594mn barrels per day (bpd)) same time that Bloomberg reported that Beijing
of Russian crude oil in April, 4% more than in the and Moscow were eyeing a deal that would allow
same month of 2021. China to fill its strategic petroleum reserves with
The customs agency did not specify whether Russian crude oil. Citing a source with knowl-
the increase had been more pronounced along edge of the plan, the news agency said the two
specific transportation routes. (China imports sides had begun discussions on a plan that would
Russian oil by sea and by overland pipeline, and allow the Chinese side to obtain Russian supplies
sometimes by rail as well.) It did note, though, at a favourable price.
that Russia had been China’s second-largest sup- The source, who spoke on condition of ano-
plier of crude in April, with only Saudi Arabia nymity as the matter is private, said that these
delivering larger volumes. discussions were happening at an inter-govern-
The dataset also showed that Chinese imports mental level, without much direct input from the
of Russian LNG had shot up by 80% y/y in April, oil companies that will actually have to carry out
reaching 463,000 tonnes. This increase occurred the deliveries. As of May 20, the parties had not
even as China’s overall LNG purchases declined come to an agreement on the scope of any pos-
as a result of lockdowns and restrictions on busi- sible deal, and there was still no guarantee that
ness and industrial activity related to coronavi- they would come to terms in the end, he said.
rus (COVID-19) outbreaks. China is believed to have room for addi-
The GAC data did not provide any infor- tional Russian barrels in its strategic petroleum
mation on Russian gas deliveries to China via reserves, though it does not make exact figures
overland pipeline. State-run Gazprom, Russia’s available to the public. Kpler, a commodities
largest gas producer, sends large amounts of gas analytics consultancy, has estimated that Chi-
to the Chinese market via the Power of Siberia nese stocks currently amount to about 926.1mn
pipeline network, which has a design capacity of barrels, Bloomberg noted on May 20. This is
38bn cubic metres per year. up on the March figure of 869mn barrels but is
Meanwhile, Russian coal shipments to China still lower than the record-high figure of about
amounted to 3.82mn tonnes in April, down by 985mn barrels that Kpler estimated for Septem-
14% y/y, according to GAC figures. The decline ber 2020, it said.™
has been attributed to mild spring weather,
higher domestic coal production and sluggish

Week 22 25•May•2022 www. NEWSBASE .com P7