A steep fall in oil import demand from China is becoming one of the main reasons the world is not suffering a greater energy crisis as the war in the Middle East nears its 100th day, according to traders and analysts. Oil is trading below $100 a barrel, despite the loss of one-fifth of the world’s supply for over three months and predictions that the market will soon hit a tipping point as stockpiles are exhausted.
Tom Baker, a senior executive at oil trader Vitol, said China’s dramatic slowing of its crude purchases in recent weeks, with demand falling by 4-5mn barrels a day, had helped cushion the loss of 12mn b/d of supply from the Gulf.
“China’s low imports have shielded the rest of the oil market,” said Martijn Rats, chief commodity strategist at Morgan Stanley in London.