Chinese refineries abandon Russian oil after US sanctions — Bloomberg
Illustrative photo: Chinese refineries are turning away from Russian oil (GettyImages)
Chinese oil refiners have begun to refuse to purchase Russian oil after the US and other Western countries imposed sanctions on leading Russian producers and some of their customers, Bloomberg reports.
According to the agency, state-owned companies Sinopec and PetroChina have already canceled a number of deliveries after the US added Rosneft and Lukoil to its sanctions list last month.
Even smaller private refineries are temporarily halting purchases for fear of being sanctioned, as happened with Shandong Yulong Petrochemical Co., which was recently restricted by the UK and the EU.
The popular ESPO grade has been hit hardest, with prices falling sharply. According to estimates by Rystad Energy AS, about 400,000 barrels of oil per day, or almost 45% of Russian exports to China, have been cut.
Russia previously held the position of the main supplier of oil to China, thanks to significant discounts caused by sanctions after the full-scale invasion of Ukraine.
Now the US and its allies are stepping up pressure by expanding sanctions not only against Russian companies but also against their buyers. The goal is to limit Moscow's oil revenues and weaken its ability to finance the war.
As China remains the world's largest importer of crude oil, reducing purchases from Russia could open up new opportunities for other suppliers — notably the United States, which agreed last week to a trade truce with Beijing during a meeting between US President Donald Trump and Chinese leader Xi Jinping.
Background
Earlier, the US imposed new sanctions against Russia. The restrictions affected the two largest Russian oil companies, Rosneft and Lukoil, as well as their subsidiaries in Russia.
Against the backdrop of new Western sanctions and Ukraine's successful attacks on oil refineries, Russian refined fuel exports fell to a record low in October this year.
