Gulf News

China resumes pumping into reserve tanks

Strategic inventorie­s exceed 33m barrels

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China resumed strategic oil stockpilin­g in March, pumping in about 8 million barrels of crude into its Zhenhai reserve tanks after halting operations in February, sources said yesterday.

This takes volumes discharged into the east coast Ningbo storage facility to 37.4 million barrels, suggesting that the reserves are now above the 33 millionbar­rel capacity, and could signal that Beijing has released crude from the tanks.

“There were 4 VLCCs (very large crude carriers) that discharged into the government tanks last month,” said a source based at Ningbo port.

A VLCC, depending on size, can transport between 2 million and 3 million barrels of oil.

Analysts and traders are watching China's strategic stockpilin­g operations for any sign that it could add to the country's growing appetite for oil and keep oil prices propped up, though there were also concerns that China will try to use the supplies to influence prices.

The world No 2 oil consumer's crude imports for March jumped 8.9 per cent versus year-ago levels to a near record, government data showed showed on Tuesday.

China imported 3.26 million barrels per day (bpd) of crude oil last month, a fraction below a November 2006 all-time high of 3.29 million bpd.

The higher crude imports, combined with lower domestic refinery output, suggested that China continued to build stockpiles at a time of lower oil prices.

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