According to insiders, strong US sanctions have led to China and India halting trade in Russian oil.
Points of attention
- Experts point to a decrease in the number of offers for Russian oil.
- The sanctions target tankers that carry a significant share of Russia's oil exports, particularly to China and India.
- The US has made a clear demand to India after increasing sanctions pressure.
Russia faces a new problem
According to Reuters insiders, trade in Russian oil, which was loaded in the spring of 2024, has stopped in Asia.
One of the key reasons is that in China there was a large price gap between buyers and sellers. What is important to understand is that the freight cost of tankers that were not affected by US sanctions began to increase rapidly.
Former US President Joe Biden's team imposed powerful sanctions against the Russian oil supply chain on January 10.
Bids for Russian ESPO Blend crude, exported from the Pacific port of Kozmino, have risen to $3-$5 per barrel above ICE Brent on a ship-to-ship (DES) basis to China after freight rates for an Aframax tanker on the route jumped by several million dollars, three traders said.
How experts comment on the situation
The CFO of the Indian company Bharat Petroleum Corp Ltd. made a statement on this matter.
According to the latter, his company has not received any new offers for March deliveries, as it was before. In addition, it is noted that the number of cargoes offered for March will decrease compared to January and December.
The team at the analytical company Kpler points out that the latest sanctions target tankers that carry about 42% of Russia's seaborne oil exports, primarily to China, although the tankers that have been sanctioned are gradually unloading oil in China and India during the period of exemption from sanctions.
The US recently told India that tankers loaded with Russian oil must unload by February 27 under sanctions.
