China’s refining industry is waiting for details about the country’s plan to release crude oil from its strategic reserves. Many market players believe that the process would be similar to what Beijing employed in releasing other commodities. China’s National Food and Strategic Reserves Administration said the release would ease soaring feedstock prices and help ensure the country’s energy security.
Industry participants and analysts have different ideas on how many barrels of the crude reserve is likely to be released, ranging from 3 million to 10 million tons (22 million-73 million barrels). The release is likely to cap the growth in China’s crude oil imports in the fourth quarter of 2021. As a result, China is expected to see a year-on-year decline of at least 2% in its crude imports in 2021. That would mark the first decline since 2001.
The NFSRA has said on its website that it would conduct the first set of auctions to release crude oil from the country’s strategic reserve on September 24. In the first auction, the NFSRA would sell 7.38 million barrels of oil which include Qatar Marine (951,137 barrels), Forties (1,095,565 barrels), Oman (1,790,957 barrels), Murban (2,953,927 barrels), and Upper Zakum (592,031 barrels) in five lots.
