Sanctioned Russian Tankers Discharge Crude In Chinese Ports

Sanctioned Russian tankers are still unloading crude oil in China despite U.S. sanctions designed to reduce Russia’s oil income during the Ukrainian crisis. On Wednesday, the vessel Krymsk, belonging to the Russian state tanker business Sovcomflot, arrived at the port of Dongying in Shandong province, China. According to shipping statistics from Kpler and LSEG, the tanker released 700,000 barrels of Sokol crude grade from Russia.

This is the second time a sanctioned Russian tanker has unloaded petroleum at a Chinese port this month. Another Sovcomflot-owned ship, Liteyny Prospect, released a comparable load of Sokol crude last week at a port in the province of Hebei.

In February, the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC) imposed sanctions against Sovcomflot and its vessels to ” responsibly reduce Russia’s revenue from oil sales.” The 14 vessels, including Krymsk, are said to be beneficially owned by Sovcomflot.

OFAC granted a general authorisation allowing the unloading of crude oil or other cargo from these vessels for 45 days in defiance of the penalties. Refiners in India are attempting to avoid breaking U.S. laws, resulting in decreased Sokol crude imports due to the intensified implementation of sanctions in recent months.

Sokol crude shipments that were supposed to sail to India but got stuck off the coast of South Korea and Singapore have started to reroute towards China. This change aims to free up more than 10 million barrels of Sokol crude lying aboard tankers at sea.

In response, China has been buying more Sokol crude lately; several shipments of this kind are anticipated to reach China’s independent refiners this month. Traders have reported that tankers carrying Sokol crude, which had been waiting offshore Singapore since December, are sailing to Chinese ports.

China emerges as a significant destination for sanctioned Russian crude amid geopolitical tensions and attempts to impair Russian oil earnings, underscoring the complexity of global energy markets during political conflicts.

Reference: Reuters

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Source: Maritime Shipping News