Oil Daily | China Boosts Oil Imports, Russia Expands Exports Amid Geopolitical Tensions

【Global Oil Supply and Demand】

Chinese crude oil imports surged 11.5% year-on-year in July, despite a 5.4% drop from June. State refiners boosted processing rates post-maintenance, pushing refinery utilization to 71.84%. The rise reflects strategic stockpiling amid uncertainties about sanctioned barrels rather than recovering fuel demand. Analysts expect strong imports to persist.

Russia plans to increase crude oil exports from western ports to 2 million barrels per day in August, following Ukrainian drone strikes on major refineries that halted domestic processing. Traders are securing Aframax tankers for exports, with spot activity increasing. Prices remain high domestically amid refinery disruptions and summer demand.

Crude oil exports from Iraq's Kurdistan to Turkey are set to resume after a two-year halt, following an agreement between Baghdad and Erbil. The initial export phase will involve 80,000 barrels per day. Despite previous disputes, Kurdistan will hand over output to Iraq's state marketer SOMO for export.

【Oil-Producing Countries Dynamics】

Indian refiners are reducing Russian crude imports due to EU sanctions and U.S. tariffs. Indian state-owned refiners consider pausing Russian oil imports entirely, while private players continue purchases at reduced rates. Russian oil accounts for 37% of India's supply, making complete replacement challenging.

【Latest Oil Policies】

President Trump is imposing a 25% tariff on Indian imports in response to India's Russian oil purchases. India, criticizing the tariffs as "unfair," argues its decisions are driven by energy security needs. Trump indicates similar tariffs could be applied to China, another major Russian oil buyer.

U.S. imposes a 50% tariff on Indian goods due to India’s Russian crude imports, citing threats to national security from Russia’s actions in Ukraine. India condemns the move, stating its need for flexibility in global energy markets and warning of economic impacts on its exports.

Germany plans to scrap the natural gas storage levy, reducing consumer energy costs by $3.9 billion annually. The levy, introduced during the 2022 energy crisis, aimed to support gas importers amid reduced Russian supplies. Germany's gas storage capacity is largely booked, providing stability ahead of winter.

Germany endorses a bill to expedite geothermal energy development for heating, recognizing projects as of "overriding public interest." Geothermal energy could meet 25% of Germany’s heat demand. The bill aims to ease restrictions and accelerate project approvals, supporting broader renewable energy goals.

【Industry News】

Germany’s offshore wind auction without subsidies failed to attract bids, highlighting the industry's unease with zero-subsidy projects amid supply chain issues. The Federal Association for Offshore Wind Energy calls for auction design reform to enhance attractiveness and ensure value creation.

【Company News】

Wall Street's top banks reduced fossil fuel financing by 25% in 2025, with Morgan Stanley cutting lending by 54%. The decline coincides with the first projected drop in global upstream investment since the pandemic, driven by shale inventory exhaustion and market risk.

【Others】

President Trump announces a 100% tariff on imported semiconductor chips unless firms commit to U.S. manufacturing. The move aims to reshape supply chains, impacting global chip producers. Exemptions benefit companies with U.S. investments, although potential supply disruptions raise concerns.

China's coal imports fell 23% year-on-year due to strong domestic production and alternative energy sources. Despite lower imports, domestic coal production and new coal power plant approvals are rising. Factors influencing imports include real estate crises and weaker industrial growth.