China seeks 30 pct increase in Saudi oil imports

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BEIJING, Nov 9 (Reuters) China has asked for a 30 percent increase in crude oil imports from Saudi Arabia for 2008 and also aims to raise imports from Iran, partly to feed two new refineries amid steady demand growth, trading sources said on Friday.

Sinopec Corp, Asia's top refiner, wants to increase Saudi crude imports to 600,000 barrels per day for next year, up from this year's 460,000 bpd, a trading source close to the supply talks told Reuters.

The supply pact, pending Saudi confirmation, would foster closer energy ties between Beijing and Riyadh, while maintaining the kingdom as China's top oil supplier.

China is keen to secure more long-term fuel supplies while the Saudis are building a refinery in China and looking to invest in a second one.

''(The increase) is to supply the two new refineries,'' said the trading source, referring to a 240,000 barrel per day Fujian refinery in the southeast coast in which state-run Saudi Aramco owns 25 percent, and a 200,000 bpd plant in Shandong province designed to process Saudi oil. Both refineries are due for completion next year.

China, the world's second-largest oil user, also appeared unfazed by growing political tensions over Tehran's nuclear programme and wants to raise imports of Iranian oil further next year, after a 17 percent rise in the first nine months of this year.

State-run Zhuhai Zhenrong Corp, China's key Iranian oil importer, is set to keep its 2008 volume steady at this year's 240,000 bpd, traders said.

But Sinopec Corp wants to raise its portion of Iranian crude, they said, as other Asian buyers such as Japan are cutting back purchases from Iran for fear of supply disruptions in the event of a conflict.

Six world powers agreed last week to draft a third round of U.N. sanctions against Iran unless reports by the International Atomic Energy Agency due in mid-November indicate Tehran has moved towards full cooperation with transparency and suspension demands.

''No impact. Business as usual,'' said a second trader close to Zhenrong when asked if the mounting political pressure was affecting China's crude deals with Tehran.

Iran is China's third-largest crude oil supplier after Saudi Arabia and Angola, accounting for about 12 percent of China's crude imports.

REUTERS BJR HS1542

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