First Look: Fuel oil imports into China climb to multi-year high | Russia remains China's top crude supplier

Oil is trading lower, around $79.35, after gaining nearly $2 last week
- The US Department of Energy announced the purchases of 3.3 MMBbls of crude for the SPR to be delivered in October, with the intent to buy another 3 MMBbls
- Speculators cut their net-long position in Brent to the lowest level since late January
Fuel oil imports into China climb to multi-year high (Reuters)
- China’s fuel oil imports have jumped to the highest level since 2020, up 10% from year-ago levels, according to data from April
- Traders purchased more shipments from Venezuela and Iran, with one Chinese trading executive saying, “Higher supplies from Venezuela due to the relaxation of sanctions contributed to the higher volumes. Refiners' margins processing the heavier materials were also supportive,"
- Traders may be purchasing additional volumes of fuel oil due to a global rally in prices, driven by strong demand from geopolitical disruptions of shipping this year
Russia remains China’s top crude supplier (Reuters)
- For a 12th consecutive month, Russia has been the top supplier of crude to China, as refiners continue to take advantage of the discounted prices driven by sanctions
- Imports from Saudi Arabia have fallen sharply amid increases in the Saudi Official Selling Price
- Imports from Malaysia, a hub for Iranian and Venezuelan crude, were the fourth-largest supply source

Natural gas prices trade higher amid near-term cooling demand potential against a backdrop of lower daily production
- June ’24 Henry Hub is up 5c this morning to trade around $2.701/MMBtu
- The Summer ’24 strip is up 2.7c to $2.817 and Winter ‘24/’25 strip is up 2.2c to $3.548
- Today’s Euro Ensemble indicates a significant short-term increase in average temperatures east of the Rockies, leading to warmer-than-normal conditions before a return to cooler patterns, with no extreme events expected into early June (Criterion)
Venture Global criticizes US FERC delay as CP2 LNG permitting review continues (S&P Global)
- Venture Global criticized the US FERC for an “eleventh-hour data request” on emissions analysis for its CP2 LNG export terminal, potentially delaying the project
- The May 15 data request aimed to assess compliance with new national air quality standards for soot pollution, delaying a scheduled May 23 FERC meeting agenda release for CP2
- Venture Global responded with updated emissions modeling, arguing compliance with federal standards and noting a closer monitoring station’s data
- The 20 MTPA project will include 18 LNG blocks and is expected to start in 2H 2028