(Repeats with no changes in text. The opinions expressed here
are those of the author, a columnist for Reuters.)
* GRAPHIC - India's refinery throughput: https://tmsnrt.rs/35H4C6f
By Clyde Russell
LAUNCESTON, Australia, Oct 27 (Reuters) - There are emerging
signs that crude oil demand is gradually recovering in major
Asian countries outside China, a key pre-condition to sustaining
any bullish view of the market.
While China's crude imports have been record-breaking, with
the five highest months being the May to September period, the
rest of Asia has struggled amid weaker demand caused by
lockdowns aimed at curbing the spread of the novel coronavirus.
But China's run of strong imports is set to end as the last
of the cheap crude bought during April's brief price war between
top exporters Saudi Arabia and Russia is finally unloaded. That
means it's vital for any optimistic view of the crude market
that the rest of Asia shows signs of life.
India, the second-biggest importer in Asia behind China, is
perhaps the best case for optimism, with imports and refinery
utilisation recovering, although not quite to pre-pandemic
levels.
Refinery throughput reached the highest in six months in
September, gaining 13.4% from the prior month to 4.33 million
barrels per day (bpd), according to government data released on
Oct. 23. While this was the best figure since March - the month when
India's first lockdowns were imposed - the September throughput
was still 8.7% below the same month last year.
India's crude imports may also have turned the corner.
Industry data showed September's arrivals of 3.48 million bpd
were 11.9% lower than August's 3.95 million bpd, but in
year-on-year terms the drop was the slowest rate of decline
since May, the data showed.
India's crude imports may also post a stronger October, with
Refinitiv Oil Research estimating that arrivals will reach 3.91
million bpd, which would be the highest since April.
Fuel demand in India also appears to be recovering, with
preliminary data showing diesel sales are likely to have risen
in October for the first time since coronavirus restrictions
were put in place in March. Diesel sales by India's three state fuel retailers rose 8.8%
year on year in the first half of October, according to
provisional data compiled by Indian Oil Corp IOC.NS , the
country's biggest refiner and fuel retailer.
RECOVERY SIGNS?
Japan, Asia's third-largest crude importer, presents a more
mixed picture, with Refinitiv data estimating October imports at
2.05 million bpd, down from 2.42 million bpd in September and
2.36 million bpd in August.
However, the soft imports come as several refineries take
units off line for scheduled maintenance, suggesting that once
these return to service, imports will pick up again.
South Korea, which may overtake Japan this year as Asia's
biggest crude importer after China and India, is showing some
recovery signs: according to Refinitiv estimates October will
see 2.95 million bpd being discharged, up from 2.6 million bpd
in September and 2.5 million bpd in August.
If October's imports are in line with Refinitiv's forecast,
it would put South Korea back to levels similar to those that
prevailed prior to the coronavirus pandemic.
There are also indications that crude imports by other Asian
countries are recovering somewhat, with Refinitiv estimating
that 2.91 million bpd will be imported by countries outside the
top six in October, up from 2.34 million bpd in September.
Still, it's worth noting that even the recovery in import
demand in the rest of Asia may only be enough to compensate for
the slowing of China's imports after their record run, not
expand the region's overall imports.
It's still too early to switch to a bullish view of Asian
crude demand, but there are signs of recovery across the region.
(Editing by Kenneth Maxwell)