China and India have stopped purchasing Russian oil due to sanctions

Russian oil trade with China and India halted as sanctions push up shipping costs.

March Russian oil trade in China has stalled due to a wide price gap between supply and willingness of buyers, Reuters reported.

On January 10, Washington imposed new sanctions targeting the Russian oil supply chain, leading to a sharp rise in tanker freight rates as some buyers and ports in China and India shied away from sanctioned vessels.

March bids for Russian ESPO Blend crude exported from the Pacific port of Kozmino rose $3-$5 above ICE Brent on DES terms to China after freight rates for an Aframax tanker on the route surged to several million dollars.

Before the January sanctions, strong winter demand and stable prices for competing grades from Iran had pushed spot ESPO Blend premiums to China to nearly $2 a barrel, the highest since the Ukraine war began in 2022.

The chief financial officer of India’s Bharat Petroleum Corp Ltd (BPCL.NS) told Reuters that the company had not received new offers for delivery in March, as it usually did, and expected the number of cargoes offered in March to be lower than in January and December.

India usually receives offers for Russian crude in the middle of each month.

Russian crude accounted for 36% of India’s imports and nearly a fifth of China’s in 2024.

Indian refiners are looking for alternative offers from the Middle East, Africa and the United States for March and April as they expect supplies from Russia to be cut.

We will remind, that the transportation of Russian oil to China has already increased in price fivefold due to sanctions.

USM previously reported that shipowners of the sanctioned fleet are trying to meet with the Trump administration.