OREANDA-NEWS. November 06, 2014. China's implied oil demand in September jumped 6.2 percent from levels seen in August to hit a seven-month peak, as crude runs soared to their second highest point this year.

A rise in demand from the world's top energy consumer could support crude prices that have plunged 23 percent so far in 2014 amid an amply supplied world market, although a slower global economic growth is expected to keep a lid on gains.

Data on Tuesday showed China's economic growth eased in the third quarter to its weakest since the 2008/09 global financial crisis as a slumping property market dragged on manufacturing and investment.
 
China consumed roughly 10.3 million barrels per day (bpd) of oil last month, according to Reuters calculations based on preliminary government data, up from 9.70 million bpd in August and 9.61 million bpd a year earlier.

But for the first nine months, growth in consumption was only about 2 percent to 9.91 million bpd, versus 9.72 million bpd a year earlier.

The outlook for China's oil demand is not very promising as evident from the International Energy Agency's move to lower its annual forecast for Chinese oil demand five times so far this year. The agency last pegged growth at 2.3 percent for 2014.

While it expects China's oil demand growth to improve to 3.2 percent in 2015, that would still be less than the agency's earlier 4.2 percent estimate.

China's diesel demand is likely to drop for the first time in over a decade this year, or at best stay flat, due to lack of construction and mining activities, industry sources have said. But gasoline and jet fuel demand have maintained strong growth on firm car sales and passenger air traffic.

Reuters calculates implied oil demand by combining official figures for refinery throughput and net imports of refined product, excluding any inventory changes. Changes in commercial fuel inventories for September will be released later this week, although absolute figures are not disclosed.

China's daily refinery throughput of crude oil in September hit 42.02 million tonnes or 10.22 million bpd, data from the National Bureau of Statistics (NBS) showed, the highest since February and up 4.8 percent from 9.75 million bpd in August.

Crude runs were up 9.1 percent from a year ago.

China also generated an implied surplus of almost 450,000 bpd of crude oil from January to September, according to Reuters calculations that combine domestic production and net imports minus crude throughput.

High crude throughput and weak domestic demand growth has allowed China to become a net fuel exporter four months so far this year, most recently in August.

Net imports in September were 320,000 tonnes, or 75,000 bpd, compared to net exports of 200,000 tonnes in August and net imports of 900,000 tonnes a year earlier, customs data showed earlier.

China imported 6.7 million bpd of crude oil in September, up 13.1 percent from August. Imports for the first nine months rose 8.3 percent from a year ago to 6.11 million bpd.