Russian oil exports to China rise by 5% in first half of 2024

Russian oil exports to China increased by 5% in the first half of 2024. Oil refiners, under pressure from weakened margins, chased barrels at discounted prices.

Source: Reuters

Details: Reuters reported that Russian oil arrivals, including via pipelines and shipments, amounted to 8.43 million metric tons in June, the equivalent of 2.05 million barrels per day, according to data from the General Administration of Customs.

This is less than 2.1 million barrels per day recorded in May and the historic maximum of 2.56 million barrels per day in June 2023. Though China’s import of Russian crude oil in June fell by 20% compared to June last year, the overall volume of Russian oil import increased by 5% in the first half of 2024.

According to Reuters, moderate Russian imports in June can partly be attributed to lower demand from China’s independent refiners, as shrinking margins amid low domestic fuel demand forced them to cut production to the lowest level since early 2020. Demand for Russian Urals crude oil shipped from European ports also declined as freight rates remained high due to tensions in the Red Sea.

Background: Russia’s Lukoil oil and gas company stopped transporting oil to Hungary at the end of June 2024, after Ukraine’s National Security and Defence Council expanded sanctions against it.

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