China to reemerge as a major oil buyer in August, JPMorgan says. Here are its top picks

China's crude oil imports are set to recover from August after plunging to their lowest level in eight years during the Middle East conflict, according to JPMorgan , as more than half of the decline in China's crude demand seen since the war may prove temporary. The country's crude imports shrank by an unprecedented 4.8 million barrels per day (mbd) between February and May — a steeper drop than the 4 mbd decline seen during the depths of the pandemic in the second half of 2020 — Parsley Ong, JPMorgan's head of Asia energy & chemicals research, said in a note on Wednesday. The pullback in purchases by the world's largest crude importer has helped absorb some of the global energy shock and cap the surge in oil prices since the war began. In May, China's oil imports slid to 7.8 mbd, the lowest since December 2017, as Beijing drew down domestic oil inventories for the first time in more than a year. Vessel-tracking data suggest imports remained around 8 mbd in June, implying a further 3 mbd inventory drawdown. JPMorgan estimates that around 3 mbd of the decline in crude demand is temporary, with a gradual recovery expected from August as chemical-sector demand rebounds and China seeks to replenish its strategic petroleum reserve. At the same time, JPMorgan lowered its outlook for China's gasoline and diesel consumption, forecasting annual declines of 6% and 4%, respectively, through 2030, both steeper than its prior forecasts. …