Oil Daily | Rising Chinese Crude Inventories and India's Increased Russian Oil Imports Signal Market Shifts

【Global Oil Supply and Demand】

China continues to build new coal-powered generation capacity abroad despite a pledge to focus on transition technology. Chinese firms back 88% of new coal projects in BRICS members, mostly in Indonesia. China also supports significant solar and wind capacity projects in new BRICS members.

Crude oil inventories in China rose to a nearly three-year high in March, suggesting demand growth is lagging behind refinery processing rates. Imports rose by 5% in March to 12.11 million barrels daily, indicating more resilient demand than expected.

【Oil-Producing Countries Dynamics】

India purchased more Russian ESPO Blend oil in April than any month since August 2024, taking advantage of lower prices due to weakening Chinese demand and sanctions on Russian companies.

【Latest Oil Policies】

The U.S.-China trade war impacts oil demand, with fears that Iranian oil could flood the market due to progress in nuclear talks. Beijing criticized U.S. negotiating tactics, emphasizing a major reduction in China's oil demand growth if tariffs continue.

China has not imported liquefied natural gas from the U.S. since February, due to tariffs and trade tensions. Chinese buyers opted for long-term deals with Middle Eastern and Asia Pacific gas producers, impacting future U.S. LNG export projects.

【Industry News】

Woodside Energy announced the final investment decision for the Louisiana LNG project, set to start production in 2029. The facility plans for three liquefaction trains and a total capacity of 16.5 million tons annually, with potential expansion.

Germany criticized a report suggesting its power market split into five bidding zones, emphasizing commitment to the single German-Luxembourg electricity bidding zone. The report's recommendations, though non-binding, could affect energy costs for the industry.

【Company News】

Exxon is set to overtake Shell and BP in low-emission project investments, planning up to $30 billion for carbon capture, hydrogen, and lithium solutions by 2030. Meanwhile, BP and Equinor reduce renewables investments to adapt to energy transition challenges.

【Others】

Electricity is being restored across Spain and Portugal after a massive outage caused chaos, grounding flights, evacuating metro stations, and leaving millions without power. Authorities are investigating the causes, with no indication of a cyberattack.

Libya’s Prime Minister called for an inquiry into the assassination of Brigadier General Ali Ramadan Al-Rayani. The incident underscores Libya's fragile post-war state amidst powerful clan rivalries, risking a resurgence of civil conflict.