Overall supplies of crude and fuel oil in January reportedly surpassed a record set in April 2020
© Getty Images / Leontura
China has further increased purchases of Russian oil in January, Bloomberg reported this week, citing data intelligence firm Kpler.
According to the report, Beijing imported an average of 1.66 million barrels of crude and fuel oil from Russia daily in January, which is more than the previous record set in April 2020. Kpler data showed that China bought the entire monthly loading of Russian ESPO grade oil, as well as Arctic grades and flagship Urals grade oil.
China has been competing with India as the biggest buyer of Russian crude after the conflict in Ukraine and Western sanctions that followed forced Moscow to look for new buyers by offering heavy discounts on its fuel. The EU and the UK banned imports of Russian crude in December, and at the same time the EU and G7 countries imposed a price cap on seaborne Russian crude.
China is ramping up purchases just as the country is gradually reviving its economy following the lifting of Covid-19 restrictions late last year. According to the International Energy Agency (IEA), recovering Chinese consumption will be the main driver in the growth of global oil demand this year, which it expects to rise to 101.9 million barrels per day.
The main allure of Russian oil currently is its relatively low price. Russia’s flagship grades are trading much lower than Brent or similar West African grades. Urals grade, for instance, averaged $49.48 per barrel in January, compared to $82 per barrel for Brent.
READ MORE: Western sanctions helped Russia find new oil markets – IEA
Russia’s overall oil exports in January averaged 8.2 million barrels per day, according to the IEA, an increase on the previous month.
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