Russia has surpassed Saudi Arabia as China’s largest supplier of crude oil, hitting a record export level in May, Reuters reported.
China purchased roughly 55% more crude from Russia over last year, overtaking Saudi Arabia after a gap of five months, according to Reuters. Russia cut prices on its oil significantly in response to sanctions and international boycotts, increasing demand, particularly among East Asian buyers, Markets Insider reported.
“China is already buying essentially everything that Russia can export via pipelines and Pacific ports,” Lauri Myllyvirta, lead analyst at the Centre for Research on Energy and Clean Air told Stars and Stripes.
China’s imports totaled 1.98 million barrels per day (bpd) in May, according to Reuters. China’s oil imports from all sources including Iran rose 12% over May 2021.
Russia also overtook Saudi Arabia in oil exports to India in May, according to Markets Insider. China and India now comprise half of Russia’s seaborne oil crude importers, keeping revenues up despite decreased prices.
Russian oil exports to Europe have crept steadily upwards in the past months, even as Russia cuts natural gas output and faces international backlash over the invasion of Ukraine, Bloomberg reported in June. Many western countries, including the U.S., have sanctioned key players in Russia’s petroleum industry, according to the U.S. Treasury Department.
Experts have warned that sanctions may benefit the Russian economy in the long term as it strengthens trading ties with other partners outside of the West. In spite of a default on loans that sanctions prevented Russia from paying, the financial system has yet to falter, experts told The Daily Caller News Foundation.
Economists forecast that Russian oil and gas revenues will rise 20% over 2021 to reach $285 billion in 2022, according to a Bloomberg Economics report.
.@POTUS knows this alone won’t provide the full relief the American people need, which is why he is calling on:
– States to suspend their gas taxes or provide equivalent relief
– Oil companies to increase output
– The industry to pass along the decrease in oil prices
— The White House (@WhiteHouse) June 22, 2022
While China’s oil imports have skyrocketed partially due to decreased prices, energy is growing more expensive in the U.S. and the economy is on the brink of recession. On Monday, the Biden administration reportedly considered lifting tariffs on certain Chinese goods to offset rising prices across the board.
The U.S. signaled a desire for friendly economic relations with China in September.
“I actually think robust commercial engagement will help to mitigate any potential tensions,” Commerce Secretary Gina Raimondo told The Wall Street Journal.
The Russian Ministry of Industry and Petroleum Trade did not immediately respond to The Daily Caller News Foundation’s requests for comment.
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