As many companies have terminated purchases of Russian oil, China is taking advantage of the situation. Reportedly, the country has agreed to buy Russian oil at a cheaper price. Both countries maintain friendly relations, which brings benefits to each party
Russia's state-owned oil company Rosneft has signed an agreement with China National Petroleum Corp. (CNPC). It will deliver 200,000 barrels of oil per day to oil refineries in the northwestern part of China. The deal value and the oil price have not been disclosed. However, according to sources familiar with the transaction, the price is much lower than the market one. Some market strategists believe that a 200,000 barrel per day delivery is not the limit. China’s North Huajin Chemical Industries Group has also entered into an agreement with Saudi oil giant Aramco on the development of a major integrated refinery and petrochemical complex in the northeast of the country.
Notably, Aramco is set to supply 210,000 barrels a day of crude oil feedstock. As a result, China will be able to fully meet domestic demand for energy and chemical products at low prices by cooperating with Russia and Saudi Arabia. Riyadh decided to forge closer relations with China after Saudi Arabia and the UAE declined Biden’s offer to increase their oil production. The Us desperately needs lower oil prices to weaken Russia, one of the largest oil exports. Earlier, the US imposed an embargo on Russian oil.
