NewsHK
Global crude markets are entering a new phase. China has begun shifting from drawing down its oil stockpiles to actively rebuilding them, a transition that is expected to drive a recovery in crude imports.
The consequence for global supply could be a tighter oil market. The end of the drawdown cycle When a large buyer draws on existing reserves rather than purchasing on the open market, its import volumes fall.
China's depletion phase has done exactly that, suppressing the demand signal reaching international crude markets. The transition to restocking changes the arithmetic. Rebuilding inventories requires fresh barrels.
Those barrels come from international suppliers, which means import demand rises as the restocking cycle takes hold.
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