Angola Passes Saudi Arabia to Become China's Top Oil Supplier

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March 29 (Bloomberg) -- Angola passed Saudi Arabia to become China's top oil supplier in February as the world's fourth-largest economy turned to Africa to meet rising demand.

Angola shipped 456,000 barrels a day to China in the first two months of the year, analyst PetroMatrix Gmbh said. That's 15 percent of China's imports and more than Saudi Arabia and Iran, OPEC's top two exporters, supplied. West African producers Congo and Equatorial Guinea are among China's ten-largest oil sources.

China, where oil imports have tripled in five years, has agreed to lend Angola $3 billion to build a new refinery and develop deepwater reserves as it competes with the U.S. for West African oil. San Ramon, California-based Chevron Corp. is Angola's largest producer.

``Asia remains a dominant crude import growth area and its strength will be more pronounced in the second half of 2006,'' Zug, Switzerland-based PetroMatrix said yesterday ``Chinese imports of Angolan crude are up 42 percent year-on-year.''

Oil imports to China rose 34 percent to 179 million barrels in the first two months of the year from the same period in 2005, according to customs data. Demand is rising as the country's automakers sell more than 500,000 cars, buses and trucks a month. Asian oil imports rose 15 percent in January and February, Petromatrix said.

Angola, where 27 years of civil war ended in 2002, is a former Portuguese colony of 11 million people. Oil production accounts for 45 percent of the country's $24 billion economy, according to the Central Intelligence Agency. Angola is the world's fifth-largest diamond miner, according to De Beers.

Iran, Congo

Saudi Arabia, the leading member of the Organization of Petroleum Exporting Countries, shipped 445,000 barrels of oil a day to China in the first two months of the year, followed by Iran's 391,000. Congo supplied 140,000 barrels and Equatorial Guinea 133,000 barrels a day.

China agreed to add $1 billion to an existing $2 billion loan backed by oil it agreed to grant to Angola, Reuters reported yesterday, citing a person it didn't name.

China Petroleum & Chemical Corp, or Sinopec, agreed last week to build a $3 billion oil refinery with Angola's national oil company. Sinopec has borrowed $1.5 billion to develop its 50 percent stake in Angola's Block 18 offshore oil field. BP Plc, Europe's largest oil company, has the other 50 percent.

China's investments in West African fields may boost oil tanker demand as more cargoes are shipped to refineries in Asia, shipbroker E.A. Gibson Ltd. said last month.

Oil is shipped from West Africa to China in so-called very large crude carriers, tankers able to carry 2 million barrels of oil. The voyage around the Cape of Good Hope and across the Indian Ocean is almost twice as long as the journey from the Middle East to China, tying up ships for longer.