US sanctions have slowed Russian oil trade in Asia
Kyiv • UNN
New US sanctions increase the cost of tanker freight for Russian oil, leading to a price gap in China. India and China reduce purchases of Russian oil for March due to higher transportation costs.
After Washington imposed new sanctions on Russia's oil supply chain, a large price gap between buyers and sellers emerged in China. The cost of freighting tankers that are not subject to US sanctions has risen sharply. India faced a decline in Russian oil supplies in December and January.
Reported by UNN with reference to Reuters.
Trading activity for Russian crude oil for March delivery slowed in Asia. According to traders and shipping data, the increase in the cost of chartering tankers that are not subject to US sanctions contributed to a significant price gap between buyers and sellers in China.
Bids for March Russian ESPO crude oil exported from the Pacific port of Kozmino jumped to $3-5 per barrel over the price of ICE Brent on a delivery-by-ship (DES) basis to China.
Freight rates for the Aframax tanker on this route have increased by several million dollars, three traders said.
This is the highest level since the start of the war in Ukraine in 2022, which pushed discounts down to $6.
Senior analyst Xu Muyu of Kpler predicts that China's crude oil imports from the Russian Far East will remain low in the coming weeks after falling to a six-month low of 717,000 barrels per day last week, Reuters reports.
As for India:
The FGE consulting company (detailed analysis of the oil, gas, LNG and liquefied natural gas markets) reports that India is facing interruptions in the supply of 450,000 barrels of Russian crude oil per day.
The number of cargoes offered for March is expected to decrease compared to January and December.
The chief financial officer of India's Bharat Petroleum Corp Ltd told Reuters last week that the company had not received any new offers for March deliveries, as would be usual.
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Russian oil accounts for 36% of India's imports and almost a fifth of China's imports in 2024.
Recall
The US demands that India unload Russian oil tankers by February 27 and complete financial transactions by March 12. India, the largest buyer of Russian oil, is looking for new suppliers among OPEC countries, the United States and others.
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