The signing of five new crude oil supply agreements (Cosa) with Chinese refiners and petrochemicals companies earlier in November should help Saudi Arabia maintain its top spot with its most important customer.

State oil giant Saudi Aramco inked five supply deals with Chinese customers that will help boost its sales volumes to China to new highs of 1.67 million barrels a day (b/d) next year, the company said in its weekly English publication, the Arabian Sun.

“Not only is this Cosa volume unprecedented for China, but rarely has a single country in Saudi Aramco’s history bought so much oil,” Aramco said. The company has been working hard over the past two years to regain its position as China’s largest supplier, a position it held from 2006 until it was knocked off the top spot for the first time in 2016.

The deals, signed by Saudi Aramco Overseas, were agreed with the trading arms of China National Petroleum Corporation, Sinochem, China National Offshore Oil Corporation (CNOOC), Hengli Petrochemical and China North Industries Group Corporation.

The agreements secure a total supply of 623,000 b/d, up 97,000 b/d from Aramco’s agreements for 2018, but could rise higher, with CNOOC signing a memorandum of understanding for an optional 100,000 b/d of additional supplies.

Aramco welcomed privately owned Zhejiang Petroleum & Chemical (ZPC) into its fast-growing Chinese customer base, with another 116,000 b/d supply deal agreed in September. The Saudi company’s Beijing office has been in talks to supply ZPC’s new 400,000 b/d crude-to-chemicals plant since late-2017, and finally secured the deal in September. Operations are due to start up in 2019, with Aramco providing 40 per cent, roughly 170,000 b/d, of the plant’s feedstock.

Aramco will also supply Hengli Petrochemical, after securing a term contract in July.

“Large, integrated crude to chemical projects like ZPC and Hengli are the future of China’s downstream industry and I’m excited Saudi Aramco will be part of their success story,” said Abdulaziz al-Judaimi, Aramco’s senior vice-president for its downstream business.

Developing these new and promising demand sources is critical to diversifying Saudi Aramco’s customer base and capturing a large share of China’s future incremental oil demand, which will increasingly come from such private refiners, Aramco said.

At more than 1.6 million b/d, China represents about a fifth of Saudi Arabia’s 7.45 million b/d of exports. Data from China’s General Administration of Customs showed the state imported 9.65 million b/d of crude, with Saudi Arabia, Iraq, Kuwait, the UAE and Oman among its biggest suppliers.

The Saudi oil giant is also reported to be close to signing another agreement with ZPC, which would give it a stake in the project.

This is part of Aramco’s wider strategy of raising its global refining footprint to between 8-10 million b/d by 2030, from 5.4 million b/d currently. This aims to give Aramco a captive market against the backdrop of rising supply from non-Opec rivals such as Russia and the US.

It already owns a 25 per cent stake in China’s Fujian integrated refinery and petrochemicals complex with Synoptic and Exxon Mobil Corp, and has plans to build a 300,000 b/d refinery with Norinco, and another refinery with PetroChina in the southwestern Yunnan province.