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China’s crude inventory draw could shape the next oil rally
The IEA estimates China pulled 41 million barrels from crude inventories in June, helping offset higher Middle East crude prices and altering how available Gulf cargoes are sold into other regions.
Oil market watchers are looking more at China’s inventory behavior than Middle East supply disruptions to understand whether the next oil rally can sustain, according to OilPrice.
The International Energy Agency estimates China drew 41 million barrels from crude inventories during June, one of the largest monthly stock draws on record, with refiners meeting domestic demand using storage instead of replacing barrels through imports.
OilPrice notes that this inventory built up before the Iran conflict, and that it has helped Beijing ride out the sharp jump in Middle Eastern crude prices.
Separately, Reuters reported that some refiners shifted toward discounted Gulf grades and delayed Iranian cargoes, leaving millions of barrels offshore without immediate buyers, while Kpler estimated Chinese seaborne crude imports fell to 6.78 million barrels per day in late May from 8.5 million bpd in April.
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