China expands its crude oil imports from Russia to a record level in June, even though total crude oil imports have declined due to the lockdown.
Russia remains China’s top supplier for the second month in a row, overtaking Saudi Arabia.
China is the world’s largest crude oil importer, and Russian oil has helped Chinese refiners keep costs down while their profit margins have been squeezed by slowing demand as a result of measures taken against the coronavirus and fuel export restrictions imposed by Beijing due to supply shortages.
Russian oil imports in June, including sea freight and oil pipelines, will account for about 2 million barrels per day, or 15% of China’s crude oil demand.
Meanwhile, Saudi oil imports are expected to fall to 1.3 million barrels per day in June, the lowest level in nearly two years.
Russian seaborne shipments were estimated at 1.04 to 1.15 million barrels per day last month. This is comparable to the record high in May of around 1.1 million barrels per day.
In addition, under government agreements, China will receive about 880,000 barrels per day of Russian oil through two Eastern Siberian-Pacific Ocean (ESPO) pipelines and the Kazakhstan-China oil pipeline. All three projects are pumping at the highest rate.
India, the world’s second-largest crude oil importer, has increased its imports of Russian oil since May after Western companies rejected a deal with Moscow.
The two countries combined bought an additional 1 million barrels per day of Russian oil in May compared to April. This is according to Chinese customs and Indian trade sources. This represents one-fifth of Russia’s total exports.