TE24 International Desk:
Russia overtook Saudi Arabia as China’s biggest crude oil supplier in the past two months due to Western sanctions over Moscow’s war with Ukraine, boosting their appeal among Asian buyers. China imported 7.3 million barrels of oil last month.
Tons of crude oil from Russia are up 9.5 percent from the same period in 2021, according to data provided to Caixin at the request of the General Administration of Customs. Oil imports rose 54.8 percent year-on-year to 8.4 million tonnes in May. Oil imports from Russia were 7.7 percent and 44 percent higher than those from Saudi Arabia in May and June, respectively, the data showed.
Saudi Arabia has long been the largest crude oil supplier to China, with Russia the runner-up. . However, Saudi Arabia remains the largest oil exporter to China in the first half of 2022, the data shows.
In the first six months, Saudi Arabia accounted for 17.1 percent of China’s total crude oil imports of 253 million tons, while Russia had a 16.4 percent share. The low price of Russian oil fueled Chinese purchases amid Western sanctions on the country in the wake of the war with Ukraine, according to JLC, a commodities market data provider. June was 18.8 percent lower than in Saudi Arabia and marked the second straight month of price declines, customs data showed.
The European Union imposed partial sanctions on Russian crude oil and petroleum products and said the sanctions would cut off about two-thirds of Russia’s oil supplies to the bloc.
Russia is reorienting its oil and gas exports from Europe to Asia, mainly India and China Some analysts speculate that Asian importers will take advantage of the opportunity to secure discounted crude oil from Russia, although they are not able to absorb all of the seaborne exports. It was previously shipped to Europe.
The European Union has banned shipping insurance for oil exports from Russia, further reducing demand in the region. “It is possible that alternative insurers in Russia, China, India or other countries will step in in the coming months to facilitate this trade,” said Ben Cahill, a senior fellow at the US think tank Center for Strategic and International Studies.
wrote in a note China’s overall oil imports fell 3.1 percent in the first half due to sluggish demand amid slowing economic growth and disruptions caused by sporadic Covid-19 lockdowns. Crude oil imports fell 10.6% year-on-year to 35.8 million tonnes in June, down 22% month-on-month.
