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News // Russia

Russia’s crude oil exports to China set to reach new highs amid US unilateral actions

29 November 2018 , 12:07Neftegaz.RU5514

Moscow, November 29 - Neftegaz.RU. Russia's energy sector has emerged as a beneficiary of a series of unilateral actions by the US, with its crude oil exports to the Chinese market skyrocketing and LNG exports poised to reach new highs, Global Times reported.

 

As the US' sanctions on Iran and trade battle with China appear set to persist, analysts expect that China will further increase imports of Russian oil and LNG, while US oil and LNG will be sidelined.

 

In October, China's crude oil imports from Russia jumped 58 % from the previous year to a new record of 1.73 million barrels per day, Reuters reported, citing data from China's General Administration of Customs. In the same month, China's oil imports from Iran dropped a staggering 64 % year-on-year to 247,160 barrels per day.

 

There is a simple reason behind the increase in China's oil imports from Russia and the fall of Iranian oil imports: the US' decision to re-impose an embargo on Iranian oil exports. This pushed Chinese oil companies to seek alternatives, namely Russian oil, in order to avoid US sanctions, according to analysts.

 

Amid the changes in the global crude market, Russian companies presented the best alternative choice for China, according to Li Li, director of research at Shanghai research and consulting firm ICIS China. «Russian oil has the best prices and best availability,» Li told the Global Times.

 

The latest sign was the completion of a massive new LNG joint venture. CNPC announced that it has completed construction of the Yamal LNG gas liquefaction plant and production has commenced with an estimated annual capacity of 16.5 million tons.

 

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