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Flurry of Oil Trades Led by China Refiner Bodes Well for Demand

  • China’s Rongsheng unit buys more Mideast crude than last month
  • Spot differentials of Russian ESPO climb $1/bbl vs last deal
Operations At Ukrnafta PJSC's Oil And Gas Field Processing Site
Photographer: Vincent Mundy/Bloomberg

The physical crude market in Asia has been reinvigorated amid a rise in buying by a Chinese mega-refiner as well as some Japanese oil companies, boding well for improved consumption.

Rongsheng Petrochemical Co. came to the market early this month to snap up about 7 million barrels of Middle Eastern varieties for June-July delivery. That’s up from 5 million barrels bought in March, and puts it on course for the biggest monthly purchase since October, according to data compiled by Bloomberg. In addition, spot differentials of Russia’s ESPO cargoes have started off stronger, trading $1 above the last reported deal.