The effect of America’s action is beginning to be seen. China has taken a big decision regarding Russian oil. Chinese refinery companies have suspended Russian oil imports via sea route. This decision has come at a time when America has imposed new sanctions on Russian oil companies.
America has imposed sanctions on Russia’s two largest oil companies, Rosneft and Lukoil. According to Reuters report, several business sources said that ChinaThese companies have suspended Russian crude oil coming through the Samrudhi route.
Sources said that due to concerns about sanctions, Chinese national Oil Companies PetroChina, Sinopec, CNOOC and Zhenhua Oil will refrain from trading offshore Russian oil at least in the short term. Currently, China imports about 1.4 million barrels of Russian oil by sea every day. Most of its part is purchased by private companies.
How much oil does China import from Russia?
Traders said Rosneft and Lukoil sell most of their oil to China through middlemen rather than dealing directly with buyers. Many traders said independent refineries may pause purchases to assess the impact of the sanctions, but would still consider continuing buying Russian oil. China imports about 900,000 bpd of Russian oil through pipelines, which many traders say will not be significantly affected by the sanctions.
India will also cut Russian oil
According to Reuters report, Indian companies will also cut down on Russian oil purchases because America has imposed new sanctions on two big Russian companies. Reuters also says that Indian companies have taken such a decision to avoid heavy tariffs. However, till now no statement has come from the government regarding Russian oil.
Fear of rising oil prices
According to the report, a sharp decline in oil demand from Russia’s two biggest customers will put pressure on Moscow’s oil revenues and force the world’s top importers to look for alternative supplies, causing global prices to rise. Experts believe that India and China are likely to turn to other supplies, which will increase oil prices from the Middle East, Africa and Latin America.
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