Brazil, Colombia, Ecuador and others have been able to increase exports to satisfy Chinese oil demand
Chinese oil demand has remained robust even though its industrial economy has been slowing. Much of the recent oil demand growth in China has been from households, as its rising middle class drove auto sales of more than 21 million cars in 2015, with 40% being large SUVs.
China has also been building up its strategic petroleum reserves to provide better energy security. We expect oil demand in China to grow by 300,000 barrels per day in 2017, roughly 3% higher than 2016 levels. Our expectation of lower oil production from China will also support a higher level of crude oil exports from Latin America.
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