Ukraine war: Russia becomes China’s biggest oil supplier

BBC

Russia has become China’s biggest supplier of oil as the country sold discounted crude to Beijing amid sanctions over the Ukraine war.

Imports of Russian oil rose by 55% from a year earlier to a record level in May, displacing Saudi Arabia as China’s biggest provider.

China has ramped up purchases of Russian oil despite demand dampened by Covid curbs and a slowing economy.

In February, China and Russia declared their friendship had “no limits”.

And Chinese companies, including state refining giant Sinopec and state-run Zhenhua Oil, have increased their purchases of Russian crude in recent months after being offered heavy discounts as buyers in Europe and the US shunned Russian energy in line with sanctions over its war on Ukraine.

The imports into China, which include supplies pumped through the East Siberia Pacific Ocean pipeline and shipments by sea, totalled nearly 8.42m tonnes last month, according to data from the Chinese General Administration of Customs.

That pushed Saudi Arabia – formerly China’s biggest source of crude oil – into second place with 7.82m tonnes.

In March, the US and UK said they would ban Russian oil, while the European Union has been working towards ending its reliance on Russian gas, as the West steps up the economic response to the invasion of Ukraine.

With fuel prices sky high, it isn’t just motorists who are filling-up when they spot a deal. Nor is it just China which has taken advantage of those discounts on offer from Russia as the latter tries to win new custom; India has also been upping purchases.

That, along with soaring crude costs, helped Russia actually grow revenues in the immediate aftermath of its invasion of Ukraine.

And for every 10 barrels of Russian oil China typically bought before the war, the UK and US between them bought one. Moscow may not struggle too hard to plug at least some of the gap as those two nations take their custom elsewhere.

Ukraine war: Russia becomes China’s biggest oil supplier

BBC

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