Contrary to expectations, Asia’s crude oil imports decreased slightly in the first half of 2024 compared to the same period in 2023. Data from LSEG Oil Research shows that Asia imported 27.16 million barrels per day (bpd) of crude from January to June 2024, down by 130,000 bpd from the previous year.
This decline was primarily due to reduced imports by China, the world’s largest oil importer. Despite increased imports by India, the second-largest buyer in Asia, it wasn’t enough to offset China’s decrease.
This trend contradicts the 2024 demand forecasts made by major industry groups like the International Energy Agency (IEA) and the Organisation of the Petroleum Exporting Countries (OPEC). While imports are just one aspect of overall demand, they are crucial for Asia due to its reliance on imported oil.
For the IEA and OPEC forecasts to be accurate, Asia’s imports, especially China’s, would need to increase significantly in the second half of 2024. OPEC predicted China’s oil demand would grow by 720,000 bpd in 2024, while the IEA forecast an increase of 500,000 bpd.
However, China’s imports in the first half of 2024 were about 11.08 million bpd, down 300,000 bpd from the same period in 2023. The increase in China’s domestic production only partially offset this decline.
India showed some growth, with crude imports reaching about 4.94 million bpd in the first half of 2024, up by 90,000 bpd from 2023. This increase is modest considering India’s strong economic growth.
OPEC expects Asia’s crude demand to rise by 1.3 million bpd in 2024, while the IEA forecasts a 900,000 bpd increase. Given the first-half decline, achieving these projections would require significant growth in the second half of 2024.
The key question for markets is whether there’s confidence in China’s economic rebound and stronger growth across Asia in the latter half of 2024. If OPEC+ succeeds in keeping oil prices above USD 80 per barrel, robust economic growth would be necessary to drive higher crude demand.