Russia sells almost all of its oil to China and India

2023-12-28 08:15:00, Kosova & Bota CNA

Almost half of this year's oil and gas exports went to the People's Republic. This was stated by the Deputy Prime Minister of Russia, Alexander Novak, to the Russian state broadcaster, Rossiya-24, on Wednesday. Another part, 40% was sold to India.

Novak, whose portfolio includes control of the country's energy sector, said Moscow had successfully sidestepped the effects of Western sanctions over the war in Ukraine, diverting supplies mainly to the two Asian giants.

The embargo fueled the divergence

He claimed that this process had already begun before the start of the Russian attack against Ukraine in February 2022 and the sanctions that followed shortly thereafter. But he said US and EU restrictions had served as a catalyst for him.

"In terms of the restrictions and embargoes on supplies to Europe and the US that were introduced... this only accelerated the process of reorienting our energy flows," Novak said.

Only four to five percent of Russian oil exports went to Europe. At 88 billion euros, revenues from sales to China and India were at a level comparable to that of 2021. By comparison, Russian oil exports to the resource-rich United States have always been very limited in scope. .

Russia sells almost all of its oil to China and India

India is the fastest growing market

Novak stated that China's share in Russian exports had increased to around 45-50%.

But the deputy prime minister also said that of the two markets, it was India where Russian sales were growing the fastest. "Before basically there were almost no supplies to India, but in two years the total share of supplies to India has reached 40%," said Novak.

India has even been able to buy Russian crude, sometimes at a discount, refine it and then sell it to Europe. This is possible in part because refineries often use crude oil from different sources. This makes it difficult or impossible to determine where the final product originally came from.

The EU's top foreign policy official, Josep Borrell, told Reuters earlier this year that the EU was aware of the problem and was looking for ways to stop or limit the practice. "India's purchase of Russian oil is normal. And if, thanks to our restrictions on the price of oil, India can buy this oil much cheaper, then the less money Russia gets, the better," Borrelli said this March. "But if they use this to be a refinery hub for Russian oil and by-products that are sold to us ... we have to act."

Russia sells almost all of its oil to China and India

Deputy Prime Minister of Russia, Alexander Novak

The oil and gas industry accounts for about 27% of Russia's GDP, according to Novak, and about 57% of its export earnings. He said Moscow remains open to other buyers. "There are many people who want to buy Russian oil. They are Latin American countries, African countries and other countries in the Asia-Pacific region," he said.

In the spring, the International Energy Agency said Russian oil exports had reached their highest level in three years, despite the sanctions. However, according to experts, it is assumed that the benefits are significantly reduced, as the circumvention of sanctions is costing Russia a lot of money./DW