China grabs cheap Russian oil – Bloomberg — RT Business News

Refiners reportedly increased purchases as latest EU sanctions set to kick in

Chinese oil refiners have started to resume shipments of Russian crude amid sharply lower prices and the EU’s impending price cap measure, Bloomberg reported on Friday.

According to its report citing unnamed traders, private Chinese processors, or teapots, purchased several shipments of Russian ESPO crude for December-January arrival. Shipments traded at deeper discounts to global benchmark Brent crude than trades completed just weeks ago, traders said.

“It is also believed that the shipments were purchased in Chinese yuan rather than US dollars, and financed by local banks and institutions,” writes Bloomberg.

Reports of increased Chinese oil purchases from Moscow come ahead of December 5, when the European Union rolls out new sanctions that will ban the bloc’s oil sector from expanding shipping services, d insurance and banking to Russian oil exchanges, unless they comply. with a price cap yet to be determined.

The report says traders want to know whether China and India can continue to buy Russian crude and whether the countries will use a proposed price cap or turn to non-European suppliers.

“In this case, the final price of the shipments will not be known until much later. This is because trades are made against the February contract average of Brent’s first month, which cannot be compiled until the end of December,” Bloomberg wrote, adding that it is unclear whether submissions will be loaded before or after the Dec. 5 deadline.

Traders reportedly said teapots weren’t too worried if their tanker shipments would be hit by EU sanctions or meet the criteria for the cap. They explained this by saying that their purchases were made on a delivered basis, which left the responsibility for shipping and insurance to the sellers.

On Friday, the EU reportedly tentatively agreed to a price cap of $60 a barrel for Russian oil transported by sea, as it aims to limit Kremlin revenue from energy exports. Moscow has previously threatened to stop shipping oil to countries that support the price cap measure.

For more stories on economics and finance, visit RT’s business section


Not all news on the site expresses the point of view of the site, but we transmit this news automatically and translate it through programmatic technology on the site and not from a human editor.
Back to top button