Chinese Refineries Accelerate Purchases of Discounted Russian Crude Oil
According to the Economic Desk of Webangah News Agency, Chinese refineries have re-entered the market seeking bargain crude oil purchases after losing import opportunities during Q4 2025 due to quota shortages. Three traders told Reuters the price spread between Russia’s ESPO crude loading in January for Chinese ports and ICE Brent has reached a record $7-8 per barrel.
U.S. sanctions against Rosneft and Lukoil have driven down prices of Russian crude grades, with discounts widening from $5-6 per barrel in early December to the current $7-8 per barrel record. While teapot refineries accelerate ESPO purchases, China’s major state-run refineries remain hesitant, largely avoiding shipments of this light sweet crude from Russia’s Far East ports.
Russia’s benchmark export grade Urals crude has also seen widening discounts versus Brent, suffering from sanctions and reduced Indian demand. Commercial sources told Reuters Urals crude for December loading at Chinese ports is selling at over $10 per barrel below Brent.
Despite recent heavy U.S. sanctions, the steep discounts on ESPO and Urals grades prove irresistible to China’s independent refineries. These facilities now hold newly issued import quotas from the government, further boosting their appetite for discounted crude. According to Oil Price, independent refineries exhausted previous quotas by early October and awaited new allocations at year-end, with Chinese authorities issuing higher total quotas than last year’s volumes.
