China's crude imports in May fell by 8.7% from the same month a year ago, according to official data released on Friday. Refiners reduced purchases due to heavy plant renovations, low profit margins and weak demand for refined products.

Data from the General Administration of Customs revealed that the largest crude oil buyer in the world imported 46.97 millions metric tons last month, or approximately 11.06 million barrels per day (bpd).

This is an increase from the 10.88 million bpd figure in April and a significant drop off of 12.11 million.

Oilchem, a Chinese commodity consultancy, said that the lower imports were due to regular maintenance at large state-run plants such as Sinopec Zhenhai, Zhanjiang and PetroChina Dushanzi, Dalian and Dushanzi.

The pressured runs were also caused by the weak demand for gasoline and diesel. The domestic diesel demand is weaker this year than expected due to the rapid penetration of LNG trucks, thanks to lower gas prices. This was confirmed by Lin Ye, an energy analyst at Rystad.

Ye said that the decline in crude throughputs had contributed to the rise in crude oil stocks, which began building since mid-April despite a slowdown in May.

Some smaller independent plants in Shandong, the eastern hub for refining, also reduced production due to higher crude prices. Others were forced to process fuel oil at lower prices.

Oilchem reported that Shandong independents processed on average 55.5% capacity in May. This is down from 62.2% of their May 2023 capacity.

Vortexa Analytics reports that China's above-ground crude oils inventories have reached their highest level since the end last year at 946 millions barrels. This is due to a weakening refinery demand.

ANZ analysts stated in a report that improved refinery margins would likely lead to crude oil imports increasing again in June, and even into the third quarter.

Imports from January to May totaled 229.03 millions metric tons or approximately 11 million bpd. This is a 1.2% decrease compared to the same period in 2023.

The data from Customs also shows that China's imports of natural gas for May increased 6.5% compared to a year ago, to 11,33 million tons. This brings the volume year to date to 54,28 million tons or 17.4% more than the previous year.

Exports of refined petroleum products (diesel, gasoline, aviation and marine fuel) increased by 9.49% compared to a year ago, reaching 5.35 million tons, up from the 4.55 million tonnes in April. The analysts at ANZ said that the increased exports of refined oil products were driven by higher inventories.

Exports of aviation fuel were also higher due to new government export quotas, which were released early in May. However, margins on diesel exports fell because of excess regional supplies. (1 ton=7.3 barils of crude oil). (Reporting and editing by Clarence Fernandez, Sriraj Kalluvila, and Emily Chow from Singapore.)