Oil refineries in China are discreetly purchasing discounted Russian crude while the world turned away fearing damage to reputation or failing foul to sanctions.
While Indian state-run oil refiners are issued number of tenders seeking to buy Russian Urals crude, Chinese state refiners are negotiation under the radar with sellers.
Private refiners are also buying up Russia crude discretely, according to Bloomberg citing traders who are familiar with the matter.
According to the same traders, independent Chinese refiners based in Shandong province bought ESPO oil that’s loaded at Russia’s eastern port of Kozmino.
The ESPO is favored by refiners since it can be shipped to smaller Chinese ports from a shorter distance which leads to lower transportation costs.
Some ESPO are also working with traders on financing options also freight available to ship crude at reasonable price. The traders who are familiar with the matter also said, cargoes of Urals are purchased by state-run processors are for June delivery.
While major global buyers shifted away from Russian crude, willing buyer and seller are engaging in transaction most in private negotiations. Earlier Shell Plc got into heavy criticism after its purchased Urals after the war started.
Sokol- another Russia’s Far East crude grades is also attracted by refineries in India. State-run Indian Oil Corp and Hindustan Petroleum Corp bought some Sokol loading in May from ONGC Vides, an equity partner in the Sakhalin-I project, according to traders, as reported by Bloomberg. Cargoes are loaded from the De-Kastri terminal.
