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Xinyi Wu

While China’s oil and gas imports from Gulf nations plunged in April amid the Strait of Hormuz crisis during the US-Israeli war on Iran, shipments from Russia have provided Beijing with a partial buffer for its growing economy.
Russia’s crude shipments to China rose 11.3 per cent year on year to nearly 9 million tonnes in April, according to Chinese customs data released on Wednesday.
But market conditions have also shifted. Much of the discount on Russian oil and gas – long a source of cheap energy for Beijing – has shrunk following the prolonged closure of the Strait of Hormuz.
Month on month, the value of China’s crude imports from Russia rose 16.2 per cent in April in US dollar terms, despite a 10.8 per cent fall in quantity.
Global demand for Russian barrels has surged after the United States introduced temporary sanctions waivers for oil already loaded onto tankers in a bid to stabilise global energy markets. On Monday, Washington announced another 30-day extension of the waiver.
The additional demand has intensified competition for available Russian supply, with more buyers now chasing the same barrels.
“Russia’s oil is trading at prices similar to Brent, even with the discount,” said Chim Lee, senior analyst at the Economist Intelligence Unit, referring to Brent crude, a global benchmark for oil prices.


China’s rising energy imports from Russia come as Russian President Vladimir Putin signals potential new energy agreements with China. The heads of major energy corporations have joined Putin on his visit to Beijing this week, with the trade expected to be a focus of bilateral talks.
“Amid the crisis in the Middle East, Russia continues to retain its role as a reliable supplier of resources, and China as a responsible consumer of these resources,” Putin told his Chinese counterpart Xi Jinping during their talks on Wednesday.
Russian foreign policy aide Yuri ‌Ushakov later said the two countries had reached an ‌agreement on “something very important” on energy, according to the Russian state-owned news agency Tass.
However, analysts previously noted that Russia’s export infrastructure was operating near capacity, leaving limited room to bring additional volumes to market.
And while imports from China’s northern neighbour have helped Beijing cushion the sharp drop in Middle Eastern supply, a significant shortfall remains. China’s total oil imports declined nearly 20 per cent in April, while its intake of liquefied natural gas plunged more than 23 per cent.
Even so, China’s oil inventories remained healthy through the month, Lee said. “Together with margin compression at the refineries and demand destruction, there wasn’t a strong need to compensate for lost imports from the Gulf,” he said.
He added that China would likely remain “more resilient than many other economies” even if inventory levels were to decline further and import pressures increased, citing state control over refined product prices and other policy tools.


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Prices are rising as demand for Russian supply spikes amid Middle East instability


Prices are rising as demand for Russian supply spikes amid Middle East instability.


China turns to Russian oil as Gulf supply drops – but is it too expensive?

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Prices are rising as demand for Russian supply spikes amid Middle East instability

Prices are rising as demand for Russian supply spikes amid Middle East instability