Despite international concerns that Chinese growth is slowing down at an increasingly fast pace, new economic figures actually show that China is still overtaking the U.S in key industrial gauges. According to Reuters data published today, China surpassed the U.S as the number one importer of crude oil in the world for the first time ever in April 2015 and its energy demands are expected to stay high.
China’s crude oil imports reached a record of approximately 7.4 million barrels per day in April, overtaking the U.S’ estimated imports of 7.2 million barrels per day. Likely reasons for the rise in Chinese demand are the still relatedly low prices and recent interest rate cuts by the Chinese central bank meant to stimulate growth.
China is already the world’s biggest energy consumer, with oil by far the largest traded energy market. Overtaking the United States means China is the top user of almost all commodities, including coal, iron ore and most metals, according to Reuters data.
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Over the past decade, oil producing countries had to drastically change trade routes from West to East and to reorient their view toward China, as its imports have increased by 700% just as American imports dropped over 30%.
China’s new position as the world’s top oil importer is also impacting energy trading. The crude market has been traditionally dominated on the buy-side by Western oil majors such as ExxonMobil, Royal Dutch Shell, Chevron or BP or merchants like Vitol and Mercuria.
Now, Chinese energy traders are increasingly active on the international scene. Companies like Unipec or China Oil, the trading arms of Sinopec and PetroChina, have entered oil markets on an unprecedented scale. With prices still relatively low, China’s demand is only expected to rise.