Ian Bremmer, founder and president of Eurasia Group, said on Wednesday that Chinese imports of Russian oil have climbed to a record high of two million barrels per day, but the “United States is unprepared to sanction the Chinese.” He said this was the result of India cutting off its purchases of Russian oil.
“Chinese imports of Russian oil now at a record high of two million barrels a day. Result of India cutting off their purchases, Russia offering discounts, and the United States unprepared to sanction the Chinese,” he wrote on X.
According to Kpler, which tracks the movement of energy vessels in real-time, China’s purchases of Russian oil are set to climb for a third straight month to a new record high in February.
Russian crude shipments are estimated to amount to 2.07 million barrels per day for February deliveries into China, surpassing January’s estimated rate of 1.7 million bpd, according to an early assessment by Vortexa Analytics. Kpler’s provisional data showed February imports at 2.083 million bpd, up from 1.718 million bpd in January.
Since November, China has replaced India as Moscow’s top client for seaborne shipments. According to the report, Western sanctions and pressure to clinch a trade deal with the US forced New Delhi to scale back Russian oil imports to a two-year low in December. India’s Russian crude imports are estimated to fall further to 1.159 million bpd in February, the report said, citing Kpler data.
The shift has depressed Russian oil prices. Cargoes have traded at a discount of $9 to $11 a barrel below benchmark ICE Brent for January and February deliveries to China.
Michele Geraci, Economist and former Undersecretary of State for Economic Development of Italy, described the development as predictable. “It is a natural outcome,” he said.
Geraci argued that Beijing’s priority is domestic stability. “Xi, of course, needs to take care of its energy deficit and needs to look after its own economy, not the economy of Ukraine, although as a secondary goal he would also welcome a stable and prosperous Ukraine. But not at the expense of its main priority that , naturally, as it should be for all head of states, remains China.”
He noted that lower oil prices could mean more quantities and therefore, for Russia, the strange situation of higher real GDP growth and lower govt revenues. “But with debt/GDP amongst the lowest in the world, they have ample capacity,” he added.
On the prospect of US action against China over Russian oil purchases, Geraci said: “Agree with you that US cannot and should no impose sanctions on China for buying Russian oil: why would anyone not?” He added a postscript: “PS the US is the main importer of Russian uranium, I understand.”
