Photo: EPA-EFE
Following the introduction of American sanctions against Rosneft and Lukoil, Chinese state-owned oil companies have halted purchases of Russian crude transported by sea. Indian refineries are also expected to sharply cut imports of Russian oil, Reuters reports, citing sources.
“The sharp decline in demand from Russia’s two largest clients will put pressure on Moscow’s oil revenues and force major global importers to seek alternative supplies, potentially driving up global oil prices,” the report states.
According to sources, Chinese national oil companies—including PetroChina, Sinopec, CNOOC, and Zhenhua Oil—are suspending purchases of sea-transported Russian oil. This step is at least a short-term measure due to concerns about sanctions.
China receives around 1.4 million barrels per day of Russian oil by sea, mostly purchased by independent refineries. These refineries are also likely to pause shipments temporarily to assess the impact of sanctions, but are expected to continue buying Russian oil in the future.
In addition, China imports about 900,000 barrels per day via pipeline, a figure unlikely to be affected by sanctions. Analysts expect that reduced purchases by India and China will shift demand to oil from the Middle East, Africa, and Latin America, leading to higher global prices.
