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Russia Scrambles to Sell Oil to China as India Cuts Imports Under Trump Tariffs
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![Photo of Vlad Litnarovych]( "Photo of Vlad Litnarovych")
Russian oil producers are scrambling to reroute shipments of their flagship Urals crude to China after India, until recently one of Moscow’s biggest buyers, began scaling back purchases in the wake of new US trade penalties, Bloomberg reported on August 8.
According to Bloomberg, citing traders familiar with the talks, Russian barrels are being pitched to both state-owned and private Chinese refiners at discounted prices for October delivery from western Russian ports.
The offers—reportedly $1 per barrel cheaper than before—are being made by Moscow-linked traders, including Litasco, the main trading arm of Lukoil.
Until now, most of Russia’s Urals exports had been heading to India, which increased imports more than twentyfold after the start of the war in Ukraine. However, that flow was disrupted when President Donald Trump signed an order slapping 25% tariffs on Indian goods over New Delhi’s energy cooperation with Moscow.
State-run Indian refiners responded by pulling back from Russian deals and cutting Urals from their near-term purchasing plans. Some private Indian refiners have kept buying after Moscow boosted its discount to $5 per barrel, but volumes have still dropped sharply.
That’s left Russia looking for alternative buyers—and China, with its vast refining sector and strategic petroleum reserves, seems like a logical destination. But analysts warn Beijing may not be able, or willing, to soak up all the barrels India is leaving behind.
“While India substantially reduces spot Russian buying, some Chinese refineries picked up a few cargoes for Urals for October delivery,” said Jianan Sun, an analyst with Energy Aspects. “But China will unlikely be able to absorb all Russian barrels backed out from India.”
Part of the challenge: Urals is not a staple crude for Chinese state-owned refiners, which typically prefer ESPO, a grade pumped and shipped from eastern Russia that comes with lower transport costs.
“We also think Chinese SOEs will be cautious about taking extra Russian barrels amid US–China trade negotiations,” Sun added.
Earlier, Trump said that additional tariffs on China could be imposed, following the example of recent 25% duties announced on India over its imports of Russian oil.
“It may happen… I can’t tell you yet,” Trump stated. “We did it with India. We’re doing it probably with a couple of others. One of them could be China.”
