China’s demand for Moscow’s coal, gas, and oil has grown significantly since Russia waged war on Ukraine, rocking energy markets worldwide. Imports of Russian energy have increased by more than half.
According to Bloomberg, Chinese customs data show that Beijing’s spending on Russian products, crude oil, natural gas, and coal, soared to $88 billion until February. Along the way, it displaced other buyers who had rejected Russian commodities due to the conflict. Comparatively, $57 billion was spent in the prior 12 months.
The increasingly unequal relationship between China and Russia was made clear during President Xi Jinping’s visit to Moscow this week. It is primarily due to China’s increased share of Russian exports. Notwithstanding international sanctions, Russia has a consistent supply of finance for its weapons and artillery. At the same time, its energy-hungry eastern Neighbor is allowed to gorge on massive amounts of fossil resources that are frequently purchased at higher discounts.
Russia: China’s New Leading Crude Oil Supplier
According to the import figures for the period, Russia replaced Saudi Arabia as China’s leading crude supplier. In addition, it was its second-largest coal supplier after Indonesia and its third-largest supplier of liquefied natural gas after Qatar and Australia. The volume of gas piped overland, which China stopped disclosing at the beginning of last year, needs to be there in the most recent ranking.
Since the invasion of Ukraine, Russian crude imports have increased to 89.3 million tons from 78.4 million tons, surpassing Saudi Arabia’s 86.8 million tons. Russian LNG purchases increased by 52% to 6.86 million tons, while coal purchases increased by 33% to 76.4 million tons.
Increased Demand for Russian Energy
As a result of the Zero Covid Policy, a struggling real estate market, and slower growth globally, China’s demand was generally weaker in 2022. It eventually contributed to the rise in demand for Russian commodities.
In terms of materials, imported refined aluminum nearly doubled to 538,607 tons, helping Russian output. At the same time, international sanctions restricted commerce with its regular consumers in Europe and elsewhere.
Here is some data about Russian imports from January through February (in comparison to the prior period):
- Imports of refined copper fell 33% to 281,908 tons.
- Imports of refined nickel decreased by 14% to 43,021 tons.
- Imports of palladium increased 1.3 times to 11,551 kg.
- Imports of gold rose by 68% to 6,803 kilos.
- Imports of wheat fell 13% to 52,668 tons.
So, we can see how China has been increasing its trading business with Russia since the Russian-Ukraine war. It has eventually benefitted both countries in the best way possible. On the one hand, Russia has been getting the chance to do business with China despite sanctions from the West. On the other hand, China has been getting good business deals on coal, gas, oil, and other energy outputs.
