Sanctions cut flow of Russian oil to China by two-thirds – Bloomberg

Bloomberg reports this in an article, according to Ukrinform.

Chinese imports of seaborne Russian crude may drop by 500,000 to 800,000 barrels a day this month, or as much as two-thirds from normal levels, according to an estimate by industry analytics firm Rystad Energy AS. Inflows from Iran, meanwhile, could fall by 200,000 to 400,000 barrels a day, or as much as 30%.

The big state-owned processors have paused purchases of ESPO, the crude that makes up the bulk of China's imports from Russia, following US sanctions on producers Rosneft PJSC and Lukoil PJSC.

Washington's targeting of the Rizhao oil terminal, which handled about a 10th of China's crude imports, is also crimping Iranian flows. And some private refiners, which are typically more risk-tolerant when it comes to buying sensitive oil, are also avoiding the grade from Russia's Far East. Their caution comes after the European Union and the UK's blacklisting of Shandong Yulong Petrochemical Co., a so-called teapot that was a major buyer of Russian oil.

Taken together, all of this has created an unusual level of trepidation in the market.

Nervousness among Chinese buyers is also growing against the backdrop of reduced purchases of Russian oil by Indian refineries — a sign that Western efforts to deprive the Kremlin of funds for its war in Ukraine are finally having an impact.

However, the resilience of already-blacklisted ports, like Dongjiakou in Shandong province, suggests there could be a resurgence in flows without strict scrutiny and enforcement, Bloomberg writes.

As Ukrinform reported, the US Treasury Department stated that US sanctions against Russian oil giants Rosneft and Lukoil are already reducing Russia's oil revenues and are likely to lead to decreased Russian oil sales in the long term.