China is quietly ramping up purchases of Russian crude at lower prices, according to shipping data and traders who spoke to Reuters, filling the void left by Western buyers who shied away from doing business with the Russians after the invasion of Ukraine in February.
The move by the world’s largest oil importer comes a month after it initially cut off Russian supplies for fear of appearing openly supporting Moscow and potentially subjecting the state-owned oil giants to sanctions.
Russia’s seaborne oil imports from China will jump to a near record level of 1.1 million barrels per day in May, up from 750,000 bpd in the first quarter and 800,000 bpd in 2021, according to a Vortexa estimate.
Unipec, the trading arm of Asia’s largest refiner Sinopec Corp., is leading the purchases, along with Zhenhua Oil, a unit of Chinese defense conglomerate Norinco, according to shipping data, according to a report by a ship broker seen by Reuters and five dealers.
Livna Shipping Limited, a Hong Kong-registered company, has recently emerged as a major shipper of Russian oil to China, dealers said.
Sinopec declined to comment. Zhenhua and Livna did not respond to requests for comment.
The United States, the United Kingdom, and some other major oil buyers banned Russian oil imports shortly after the invasion. The European Union is finalizing a new round of sanctions, including a ban on Russian oil purchases. Many European refiners have already stopped buying from Russia for fear of running into sanctions or attracting negative publicity.
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