State firms ask for assistance from Beijing ahead of EU sanctions
© Getty Images / CHUNYIP WONG
China’s largest oil companies have been calling for government help to keep Russian crude imports flowing as new EU sanctions are set to kick in next month, Bloomberg reported on Wednesday.
People familiar with the matter told the media outlet the refiners are worried about their ability to work out the payment channels, logistics, and insurance needed to keep buying from the OPEC+ producer after December 5.
Some solutions that have been floated reportedly include increasing the volume of Russian oil transported via pipelines, setting up a designated bank to handle payments and liaison with Moscow, and the use of more out-at-sea transfers to help with the challenges of direct shipments between seller and buyer.
Concerns have been growing as the EU is set to ban the financing, insuring, and shipping of Russian crude in three weeks, unless terms for exemption are met.
“Asian importers are seeking workarounds that don’t involve banks, insurance clubs and shipowners from the bloc,” says the report.
It’s unclear if any of these options will be rolled out, the sources noted.
Meanwhile, US President Joe Biden has recently stressed the importance of keeping Russian oil flowing to prevent a supply shock that would send prices soaring. US Treasury Secretary Janet Yellen said this week that Chinese and Indian imports of Russian oil were aligned with America’s goal. Yellen also backed an oil-price cap idea that would exempt shipments from European sanctions.
READ MORE: Record volumes of Russian oil heading to Asia – Bloomberg
Data compiled by Bloomberg showed that Moscow shipped 2.9 million barrels of crude daily in the seven days to November 11. The volume of Russian crude heading to Asia reportedly reached 2.01 million barrels a day on a four-week rolling average basis, with China and India purchasing the bulk of supplies.
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