Russia will be China’s largest oil supplier in 2023

Hong Kong
CNN
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Russia has surpassed Saudi Arabia According to the latest Chinese customs data, it will become China’s largest oil supplier by 2023.

The world’s largest oil buyer last year sold record volumes at bargain prices, taking advantage of Moscow’s desperate search for new buyers amid Western sanctions following the Kremlin’s 2022 invasion of Ukraine. imported Russian crude oil.

Russian crude oil shipments to China in 2023 increased by 24% from 2022 to 107.02 million tons, according to data released by the China General Administration of Customs on Saturday.

With this, Russia has overtaken Saudi Arabia to become China’s largest oil supplier this year. The Middle Eastern country shipped 85.96 million tonnes of crude oil to China in 2023, down 2% from 2022.

Currently, Russia accounts for 19% of China’s oil imports, followed by Saudi Arabia for 15%.

Russia became China’s top oil supplier eight years ago, but fell behind Saudi Arabia between 2019 and 2021, when the Gulf nation ramped up energy trade with China.

But starting in 2022, China has increased its purchases of cheap Russian crude oil after Western countries hit Moscow with unprecedented sanctions. China’s imports of Russian crude oil increased by 8% from 2021 to 86.24 million tons in 2022. Neighboring India also saw a sharp increase in purchases.

“China will inevitably maximize its intake of discounted crude,” said Vandana Hari, founder of Singapore-based Vanda Insights. “Russian barrels were much cheaper than comparable grades until 2023, as they were more or less limited to the Chinese and Indian markets.”

China’s total spending on Russian crude oil reached $60.64 billion last year. In other words, CNN calculates the average import price to be $566.64 per tonne.About 10% cheaper than the average price The price for Saudi crude oil was $626.86 per tonne.

Russia’s oil discount helped reduce China’s energy bills.Even though total crude oil volume increased by 11% Including imports from Saudi Arabia and Iraq, Total spending on oil purchases actually fell by 7.7% in 2023 compared to 2022, to $337.5 billion, according to customs data.

Saudi production cuts also helped Russia, Hari said. jump over. Gulf countries implemented additional voluntary production cuts of 1 million barrels per day between July and December last year. Russia also voluntarily made additional production and export cuts, which were about half of Saudi Arabia’s cuts, he added.

Despite the war, Beijing and Moscow have forged closer ties over the past two years in areas other than energy.

Overall trade between China and Russia reached a new record high of $240 billion in 2023, an increase of 26% from the previous year. This means that both countries have achieved the goals they set in 2019 about a year ahead of schedule.

In the two years since the invasion, hundreds of global brands have fled Russia. This has forced Russians to look for alternatives for everything from smartphones to cars, and Chinese companies have often benefited.

Last month, Chinese leader Xi Jinping praised the partnership between Beijing and Moscow during a meeting with Russian Prime Minister Mikhail Mishustin.

China’s official Xinhua news agency reported that Xi told a meeting in Beijing that trade statistics showed “strong resilience and a broad outlook.”

Xi added that the two countries should “maximize the advantages of political mutual trust” and “deepen cooperation on economy, trade, energy and connectivity.”