Page 11 - FSUOGM Week 25 2022

FSUOGM PERFORMANCE FSUOGM

Russia emerges as top Chinese oil

supplier in May

RUSSIA RUSSIAN oil exports to China soared 55% in the extra imports from Russia.
May, as Chinese refiners ramped up purchases India and countries in the Middle East have
Chinese refiners have of discounted Urals crude. also stepped up Russian oil supply to exploit the
been taking advantage China is one of a number of buyers not on discount. Western efforts to deprive Russia of its
of the heavy discount board with Western sanctions against Russia to oil export revenues to fund war in Ukraine have
on Urals oil. have taken advantage of the hefty discount that also been undermined by soaring international
its flagship oil blend now trades at. Prior to Mos- oil prices. In fact, Russia earned 40% more in
cow’s invasion of Ukraine, the Urals discount hydrocarbon revenues in May than in the same
was only $10 per barrel, but this has now almost month last year, according to a study by the Hel-
quadrupled as Western buyers have shunned the sinki-based Centre for Research on Energy and
fuel. Clean Air.
Imports of Russian oil, including supplies In its study, CREA called on Western policy-
delivered by the East Siberia-Pacific Ocean makers to target the shipping of Russian oil to
(ESPO) pipeline and seaborne deliveries, prevent the country simply diverting its oil to
amounted to almost 8.42mn tonnes (2mn bpd) other markets. Over two thirds of the oil that
in May, Chinese customs data shows, up from Russia exported in the first 100 days of the war
1.59mn bpd in April. The growth meant that in Ukraine was on board ships owned by EU, UK
Russia displaced Saudi Arabia as China’s top and Norwegian companies, the centre estimated,
supplier. The kingdom dispatched only 1.84mn exposing this trade to sanctions risk. Russia can-
bpd of crude to the Chinese market last month, not simply divert oil supplies from Europe to
marking a rise of 9% year on year. Asia via pipeline, as the pipeline systems of east
Chinese companies, including the country’s and west Russia have limited connections. As
largest trading company UNIPEC, are under- such, it has resorted to putting more oil on board
stood to have hired additional tankers to handle ships to access non-Western markets. ™

Week 25 22•June•2022 www. NEWSBASE .com P11