China ramps up Russian oil purchases, squeezing India — Reuters
Photo: an oil tanker (Getty Images)
China is rapidly increasing its purchases of Russian oil to replace supplies from the Middle East. This is causing a shortage of raw materials in India and creating the risk of an acute fuel shortage across Asia, Reuters reports.
According to estimates by Kpler analysts, Russian oil imports to China by sea in August will total 1.25 million barrels per day. Although this is slightly less than July's figure of 1.423 million barrels, both months saw the highest volumes since April of this year.
China has significantly changed the structure of its purchases—specifically, Beijing previously imported oil mainly from eastern Russian ports (ESPO grade). Meanwhile, in August, the share of shipments from European terminals (Urals grade) rose to 31%.
Imports decline to India
The redirection of crude from European ports in Russia to China has hit India, which is the main buyer from that route.
The total volume of Russian energy imports to India in August fell to 1.87 million barrels per day. By comparison, in July this figure stood at 2.79 million, and in June—2.73 million barrels per day.
India is already facing difficulties in finding a replacement for Russian fuel, which China is now purchasing. Since India is the largest exporter of gasoline and diesel fuel in the region, the shortage of crude oil for Indian refineries will become apparent as early as September.
If the shortage of raw materials leads to a reduction in exports of refined petroleum products, a severe fuel crisis could erupt in Asia.
Russia is rerouting exports of Kazakhstani oil from the Baltic port of Ust-Luga to the Black Sea port of Novorossiysk. In this way, the Kremlin is attempting to free up export capacity amid the threat of new attacks in the Black Sea.
Over the past few months, drone strikes have put up to 40% of Russia's oil refining capacity out of commission. As a result, about one-third of Russians have already experienced fuel shortages.
