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Russia Loses Ground to China in Central Asian Trade

Russia Loses Ground to China in Central Asian Trade

Kyrgyzstan has a significant trade…

China Is Importing Less Iranian Crude As It Buys More Russian Barrels

Russian crude oil imports into China have reduced the country’s intake of Iranian crude, Hellenic Shipping News reported, citing data from shipbroker Xclusiv.

According to the data, increased Chinese appetite for discount Russian crude has led to a sharp increase in Russian imports but these have increased at the expense of Iranian oil cargos.

Xclusive noted that this month demand for all crude from Chinese refineries might decline due to some of them entering scheduled maintenance.

Reuters meanwhile reported earlier that Chinese refiners are now competing with Indian peers for Russian ESPO crude—a blend that’s more expensive than the flagship Urals.

The report cited unnamed sources as saying India and China were eager to buy as much ESPO for next month as possible, pushing its price higher. India refiners Reliance Industries and Nayara Energy had already managed to book at least five cargos of a total of 33 offered for delivery in April, attracted by the low price.

This is a break from normal when Chinese refiners have been the only buyers of ESPO, which Russia ships from its Pacific coast.

Reuters goes on to note that most Russian crude is being traded below the price cap set by G7 and the European Union, yet the price chart for ESPO shows that the crude has not traded at $60 or below for at least a year. Its latest price, as of Wednesday, was $71.61 per barrel.

In an earlier report this month, Reuters cited cargo-tracking data as suggesting Chinese imports of Russian crude could hit a record this month before potentially declining as Russian tightens production.


Data from tanker trackers Vortexa and Kpler, Reuters reported, suggests that Chinese refiners are set to import some 43 million barrels of Russian crude this month, of which 20 million barrels of ESPO.

By Charles Kennedy for Oilprice.com

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  • Mamdouh Salameh on March 10 2023 said:
    Between them, China and India are currently importing an estimated 4.0 million barrels a day of Russian crudes Urals and the more expensive ESPO. When one adds Turkey’s purchases and other Asian countries’ and Asian oil traders’, it means that Russia has found new markets for its entire oil exports as well as gas and coal exports. Moreover, Chinese refiners are now competing with Indian peers for Russian crude imports particularly the ESPO crude.

    China’s appetite for Russian crude isn’t because Russia crude is being traded below the Western price cap of $60 a barrel as Reuters claimed wrongly but because Russian crude delivery is more secure for instance than Iranian crude which has to pass through the dangerous chokepoint of the Strait of Hormuz and the Malacca Strait through which 80% of China’s crude oil imports pass daily, The bulk of Russian crude is delivered via secure Russian oil pipelines traversing the Chinese-Russian borders and from the Arctic via the Northern Sea Route (NSR).

    According to a recent study by US researchers at the International Finance Centre at Columbia University and the University of California Russia has been selling its crude oil at $74 a barrel well above the cap. This means that whatever price discount Russia is offering its loyal customers ranges from $6-$10 a barrel. Moreover, Russian oil companies can’t sell their oil below the cap according to a decree issued by President Putin last December.

    There are reports suggesting that Chinese refiners are set to import some 43 million barrels of Russian crude this month, of which 20 million barrels of ESPO.

    Dr Mamdouh G Salameh
    International Oil Economist
    Global Energy Expert

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