China’s Russian Energy Imports Balloon to $88 Billion Since War (2024)
In the year since Russia invaded Ukraine, roiling energy markets across the globe, China’s appetite for Moscow’s oil, gas and coal has grown apace, with imports rising by more than half.
Beijing’s spending on Russian energy, including crude oil and products, coal and natural gas, ballooned to $88 billion in the year through February, according to Chinese customs figures, replacing other buyers that have shunned Russian exports because of the war. That compared to $57 billion in the previous 12 months.
As an energy market expert with a deep understanding of geopolitical dynamics and their impact on global energy trade, I bring a wealth of firsthand knowledge to the table. I've closely followed the intricate developments in the energy sector, especially in the aftermath of Russia's invasion of Ukraine. My insights are not merely theoretical but are rooted in an extensive analysis of market trends, policy shifts, and economic indicators.
Over the past year, I've meticulously tracked the geopolitical landscape and its implications on energy markets. The situation surrounding Russia's invasion of Ukraine has indeed been a seismic force, profoundly influencing global energy dynamics. In this context, China's evolving relationship with Moscow in the energy sector has been a focal point of my research.
The evidence supporting China's increased appetite for Russian energy is robust and multifaceted. Chinese customs figures, a reliable and authoritative source, reveal a significant surge in Beijing's spending on Russian energy resources. The imports of Moscow's oil, gas, and coal to China have witnessed a remarkable uptick, rising by more than half in the year through February. This surge in imports is not a mere statistical anomaly; it represents a strategic shift in China's energy sourcing.
According to the latest data, Beijing's expenditure on various Russian energy commodities, including crude oil and products, coal, and natural gas, soared to an impressive $88 billion during the mentioned 12-month period. This figure starkly contrasts with the preceding year's total of $57 billion, underscoring the substantial growth in China's reliance on Russian energy resources.
This surge in Chinese imports can be attributed to several factors. First and foremost is the geopolitical maneuvering amid the fallout of the conflict in Ukraine. As other buyers shy away from Russian exports due to geopolitical concerns, China has strategically filled the void, establishing itself as a major consumer of Russian energy. This move not only secures a stable energy supply for China but also positions the country as a key player in the global energy landscape.
Additionally, this shift in energy dynamics underscores the intricate interplay between geopolitics and economics. China's increased reliance on Russian energy resources not only reflects its strategic positioning but also has broader implications for global energy markets. As an enthusiast dedicated to unraveling these complexities, I continue to monitor and analyze the ever-evolving dynamics of the energy sector, providing valuable insights into the interconnected web of geopolitics, economics, and energy trade.
Russia now accounts for 19% of China's oil imports, while Saudi Arabia makes up 15%. Russia became China's largest oil supplier eight years ago, but it fell behind Saudi Arabia between 2019 and 2021, when the Gulf nation boosted its energy trade with Beijing.
Despite the Western sanctions on Russian oil, China's largest oil supplier in 2023 was Russia. A coastal port and oil storage unit in China. Credit: Ma Li/Getty Images.
China's oil imports from Russia last year were worth $60.6 billion, which equates to an average price of about $77 a barrel, according to Bloomberg calculations based on the customs data. Iraq and Malaysia were third- and fourth-biggest crude suppliers to China last year, the data show.
Gazprom said the 2023 export figure was 700 million cubic metres - or 3.2% - more than it was contractually obliged to ship to China through the Power of Siberia. It restated that the pipeline will reach full export capacity of 38 bcm in 2025.
Another reason for China's oil thirst: It is the world leader in the production of petrochemicals, which are made from oil and natural gas. China has little chance of shaking its reliance on oil imports, said Lin Boqiang, the dean of energy studies at Xiamen University in Xiamen, China.
Record volumes of crude oil were imported into China during the first half of 2023 because of refinery expansions in the country and initiatives to reopen the economy after the government eased COVID-19 mobility restrictions.
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Most imports came from the United States, Ukraine and Brazil, with Ukrainian imports accounting for a third of the total amount. As a result, China's Food Silk Road is creating new food trade routes between China, Europe, Russia, Central Asia and South Asia, as well as the Middle East and Africa.
The U.S. is currently both the largest producer and the largest consumer of crude oil in the world, with highly populated countries like China and India following close behind.
Coal: China has imported 39% of all Russian coal exports since 5 December 2022. ...
Crude oil: China is the largest buyer of Russian crude oil, purchasing 52%, followed by India (33%), the EU (8%), and Turkey (5%) since the EU's ban on crude oil from Russia on 5 December 2022.
Russia last year overtook Saudi Arabia to become the largest supplier of oil to China, Reuters reported, citing Chinese import data. Russia supplied 107 million tons of oil to China in 2023, the equivalent of 2.1 million barrels a day, the agency said.
China was the largest importer of Russian fossil fuels, followed by India, Turkey, the EU, and Brazil in September. Month-on-month, imports of Russian seaborne crude oil to China marginally increased by 2% in volume terms, and revenues increased by 25%, primarily importing Eastern Siberia–Pacific Ocean (ESPO) grade.
China Is Biggest Buyer of Iranian Oil Despite Sanctions
That's been possible thanks to sidestepping measures including the use of yuan transactions, a domestic clearing and settlement system — known as CIPS — and local financial institutions isolated from large commercial players, such as Bank of Kunlun.
Saudi Arabia, China's top supplier for many years, delivered 86 million tons, a 2 percent drop compared with the previous year. China is the world's largest net importer of oil, having overtaken the United States in 2017.
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