China, India Seek Oil Supplies As U.S. Sanctions Hit Russian Crude

Chinese and Indian refiners are scrambling to secure crude supplies as new US sanctions on Russian oil producers and tankers disrupt shipments to Moscow's primary customers, Reuters reported.

Over the weekend, China's Yulong Petrochemical secured 4 million barrels of Abu Dhabi's Upper Zakum crude for its 400,000-barrel-per-day refinery in Yantai. I Photo: Nanshan Group

The US Treasury imposed sanctions recently on Russian oil firms Gazprom Neft and Surgutneftegas, along with 183 vessels linked to transporting Russian oil. These measures target the revenues Moscow uses to fund its war in Ukraine.

Western sanctions and a G7 price cap introduced in 2022 had already redirected Russian oil trade from Europe to Asia, with China and India emerging as key buyers.

Some of the affected tankers also transported Iranian oil, which is similarly sanctioned.

The sanctions have tightened global crude supply, driving up spot premiums for oil from non-sanctioned regions like the Middle East, Africa, and Brazil. Over the weekend, China's Yulong Petrochemical secured 4 million barrels of Abu Dhabi's Upper Zakum crude for its 400,000-barrel-per-day refinery in Yantai, which began trial operations in September.