- BBC News World
Russia has found new customers for its powerful oil and gas industry, which are expected to ease tough sanctions imposed by the West.
After the invasion of Ukraine, Russia has made Saudi Arabia a major supplier of oil to China.
According to reports, The Kremlin offered Beijing a discount on its oil and gas pricesThis allowed it to find a market for goods that could not be sold in the wake of the sanctions imposed by the war launched by Moscow.
He also went to India: Prior to the invasion, 1% of Russian oil exports were levied on Asian giants, which increased to 18% in May.
This means that despite Russia’s revenues from oil and gas exports falling, revenues from the energy sector are sufficient to finance the military effort to represent the Ukrainian invasion.
Russia’s crude oil imports – including goods coming through the East Siberian-Pacific Ocean pipeline – reached 8.42 million tonnes last month, according to data from China’s Customs Administration.
This is an increase of 55% over last year, reaching record levels in May.
Chinese state-owned companies Sinopec and Genhua Oil have increased crude purchases in recent months.
Companies received profound discounts from Russia as buyers in Europe and the United States began to avoid Russian oil and gas following the invasion.
This makes Saudi Arabia the second largest supplier of oil to China with 7.82 million tonnes.
But Russia is not the only country where China has sanctions on oil purchases: Beijing bought 260,000 tonnes of crude from Iran last month, its third purchase since December.
According to a report released last week by the Research Center for Energy and Clean Air (CREA), Russia has seen a steady decline in hydrocarbon sales since sanctions were imposed.
However, the report warns that Moscow continues to find legal loopholes for exports.
One of them is that oil can be exported to third countries like India, refined and then exported to European countries.
The BBC’s business correspondent Theo Legett said: “The report notes that large quantities of Russian oil are being exported to India for refining, most of which refines to European markets.
“And Moscow is moving from new markets and Russian oil pipelines to ships, most of which are owned by European companies.”
“For pressure to be effective in Russia, issues like these need to be addressed.”
The European Union is Russia’s major consumer of oil and gas.
Of the $ 97 billion that Russia received in energy exports in the first 100 days of the war in Ukraine, $ 59 billion came from the European Union.
But an agreement to completely ban the purchase of hydrocarbons from Russia has been reached.
The European Union plans to ban Russian oil imports by sea by the end of this year and reduce imports by more than 60%.
In addition, in March, the European Union cut Russian gas imports by at least two-thirds over a one-year period.
For its part, the United States has imposed a complete ban on the purchase of oil, gas and coal from Russia, and the UK is expected to do so by the end of 2022.
What can happen?
“As fuel prices continue to rise, motorists are not the only ones queuing up for discounts,” said Darshini David, the BBC’s global business correspondent.
David explains that India and China have been able to take advantage of Russia’s current situation, but warns that the moment of good Russian exports will only last a short time as European sanctions take effect and shift to other suppliers. .
“Russia’s oil revenues are already falling and will intensify as other countries look for alternative energy sources.”
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