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1) Despite this piece today highlighting the strong appetite for sweet crude from teapot refiners in Qingdao, we still see Arab Gulf sour grades as the leading source of imports into Qingdao.

That said, according to our ClipperData, imports of sour Latin American grades have been marginalized in recent months as total teapot demand wanes, while West Africa – the leading region for sweet grade crude to the northern port – continues to see volumes holding up.

2) The chart below is a useful reminder that while Asia is the leading destination for crude exports, it also plays a key role as a producer too. Asian oil production accounts for about 8 percent of supply at 7.5 million barrels per day last year, but as we see capex cuts in countries such as China and Malaysia, this region is set to see falling production over this year and next.

China is set to lead the charge in terms of production losses, with output dropping by more than 6 percent this year as leading producers PetroChina and Sinopec slash spending. Imports are projected to account for 76.1 percent of Asian supply next year, up from 73.4 percent in 2015. 

3) Business Insider View Full Article