China’s top oil firms to up crude purchases from Libya

China’s top two state oil firms have agreed to lift about 140,000 barrels of crude oil per day from Libya under term deals for 2012, set to raise China’s crude purchases from the North African exporter after supply disruptions last year.

State trader Unipec, the trading arm of top Asian refiner China Petroleum & Chemical Corp, would lift about 100,000 barrels per day from Libya, while Chinaoil, the trading department of PetroChina, would buy another 40,000, traders with knowledge of the deals told Reuters.

The two contracts were signed separately with Libya’s National Oil Company, and cover January-December supplies this year, with Unipec one of Libya’s largest oil clients as its output recovered after a civil war last year.

“In terms of volumes, Unipec should be one of the National Oil Company’s biggest buyers,” one trader said.

China’s crude imports from Libya fell nearly two-thirds last year to about 52,000 barrels per day, as the civil war in Libya hit production facilities and halted exports for about six months.

Libya’s crude exports were expected to rise to 800,000 barrels per day in January, while production climbed to 1.3 million barrels, moving closer to pre-war levels of around 1.77 million barrel per days, Reuters reported.

Unipec’s 100,000 barrels a day contract is tiny compared with China’s total crude imports of over five million per day, but it adds to Unipec’s increased supplies secured through similar term deals with Saudi Arabia and Iraq.

They will help cover the cuts Unipec made in term Iranian crude imports, estimated by a Chinese trade executive to be up to 54,000 barrels a day for 2012.

In December, OPEC member Libya awarded oil supply contracts for 2012 to four major trading houses — Glencore, Gunvor, Trafigura and Vitol.

— Reuters