Monday 8 June 2015

China oil imports drop 23% in May.

The world oil markets are rocky again today, with news that China's imports of crude have fallen 23% in May and also that Chinese exports are down for the third month in a row.

Meanwhile, US output due to fracking is continuing so there will be a huge oil glut this year. OPEC seems no nearer to heeding its £30 million barrels a day output target as  nations like Nigeria and Venezuela remain desperate for hard currency.

Meanwhile, there is more to the China story than meets the eye. According to a good source of mine, there was a helicopter crash in central China last month, the helicopter was flashy Eurocopter and it turns out it was unregistered.

A quick check found 25 other unregistered copters all sold to scion of Oil executives in China's major oil companies. And shortly thereafter the investigations came. The discovery of a chain of executives taking big bribes to buy oil at expensive prices (or cheap, with loaded commissions).

If this sounds far fetched enough the sums allegedly stolen I won't even type - its just too fantastical.

However, I note this was last month and then the following month imports of crude have collapsed. A nice co-incidence no doubt?


Nick Drew said...

now FT's man Butler is also saying 'oil down' (maybe £-wall): that's where I am too

(but don't ever take him as gospel, he sometimes writes just what he's been told over a good lunch)

executives taking big bribes to buy oil at expensive prices - surely not !

perhaps someone will start looking at gas import prices in one or two euro-oountries we could mention, & who gets themselves involved in those contracts ... (not just 'executives' either)

CityUnslicker said...

I know, who would have thought?

Anonymous said...

re: CU

Since the fall of Enron is there another company as so positively scummy as Trafigura?

Remember seeing them caught trying to dump highly toxic waste in an African landfill....

Blue Eyes said...

...or maybe the Chinese have suddenly switched to thorium??

CityUnslicker said...

Anon - Trafigura are real baddies, you would not want to cross the. I note today they released their results too, 1/3rd drop in income and yet doubling their profits more or less - 'traders' extraordinaire. They Chinese end is massive though so this could be a big blow, but they can make arrangements to save themselves no doubt.

Suff said...

It’s the Chinese way when something goes wrong (or they realise there is scam that the top table aren’t involved in). Arrest everybody, freeze all assets and then start the investigations. The party has to be seen, to be doing something.
In theory this is how to stamp out corruption and there’s many areas of our system I would love to see this happen. In practice however, the fall out on innocent bystanders is horrendous. For all those companies clambering for Chinese investment, have a contingency plan. If your investor is dealing with a company, that deals with a company, who is perceived to have done something wrong, you suddenly find your assets seized and cash flow blown, irrelevant of your profit margin or job losses etc.

CityUnslicker said...

Suff - points well made. ALso the end game is to ge rid of the corrupt people who are not your mates and replace them with similar who are. The idea of ending the corruption is for the birds, at best they just want to stop it being so egrious that it starts revolutions.