Chinese Independent Refiners Pulling Less Bitumen Blend

Chinese independent refiners pulled in lower volumes of bitumen blend in March m/m but with Venezuelan sanctions looking less likely to extend at a present, volumes could increase in the coming months according to Platts sources.

• In March, around 500,000 mt (3.18 million barrels) of bitumen blend were imported by Chinese independent refineries - down by 29.9% m/m.
• Venezuelan barrels are typically imported into Chinese independent refiners as “bitumen blend” to somewhat obscure their identity.
• In the first three months of the year, 2.21 million mt (14 million barrels) of those Venezuelan crudes were imported, down by 51.1% from a year earlier according to Platts.
• Less Venezuelan barrels have headed to China due to eased US sanctions allowing those barrels to flow to other markets, primarily the US Gulf but asphalt demand has also been weak, something Merey grades are suitable at producing.
• Venezuelan Merey crude was being offered at a discount of around $10-$12/b against ICE Brent futures on a DES basis, slightly lower than a discount of $8-$9/b a month earlier Platts reported.