Russia became China’s leading oil supplier in the first two months of 2023, displacing Saudi Arabia in the process. This is just another indication that the global energy trade is being rewired.
During the same time period, China’s oil imports from Russia totaled 1.94 million barrels per day (bpd), while Saudi Arabia’s total crude imports were 1.72 million bpd. The number of people entering the country from Russia increased by 23 percent, while the number of Saudis entering the country fell to its lowest level since June. This represented a 29 percent decrease from the previous month.
A reorganization of the global oil trade has taken place as a direct result of Russia’s invasion of Ukraine. The European Union and the United Kingdom both placed a restriction on the import of crude oil from Russia in 2017. They continued their actions by imposing a ban on Russian petroleum goods such as fuel oil in the month of February. These actions have coincided with the implementation of a price cap by the G-7 countries on Russian oil and products that are related to it.
The curbs, which were designed to keep Russian oil on the market to prevent a spike in price while limiting Moscow’s ability to benefit from the sales, have caused a shift in the flow of trade.
Both China and India have emerged as major purchasers of Russian crude, which has the effect of reducing the market share of Gulf countries in Asia. In the meantime, Gulf states are shifting their sales towards Europe, where Russia has been the preeminent energy supplier for a significant portion of time.
Analysts believe that the shifting patterns of international trade could have geopolitical repercussions.
‘Saudi customer service’
Gulf states have reemerged at the centre of global conversations regarding energy security, with Europe and the United States pursuing countries such as Qatar and Saudi Arabia to assist in the replacement of energy supplied by Russia.
“Putin is now the one who is at a disadvantage. Mohammed bin Salman has re-entered the spotlight on the international stage as a result of his isolation “In a prior conversation, Kristian Coates Ulrichsen, a political scientist at Rice University’s Baker Institute, shared his thoughts with MEE.
With the murder of Jamal Khashoggi, a contributor for Middle East Eye and The Washington Post, the Saudi Arabian Crown Prince Mohammed Bin Salman was ostracised throughout the Western world. In spite of this, he recently met Vice President Joe Biden of the United States in Saudi Arabia and travelled throughout Europe.
The Middle Eastern Gulf states continue to sell the most oil to China, the world’s largest consumer of oil. More than a quarter of the entire amount of crude exported by the Kingdom of Saudi Arabia was sold to China in 2021, when China imported crude from Saudi Arabia at a value of $43.9 billion.
As evidence that China’s economic footprint is forcing it to flex its geopolitical muscles, analysts have pointed to China’s latest diplomatic excursion in the region, which consisted of negotiating a reconciliation between Saudi Arabia and Iran.
a senior research fellow at the Columbia University Center on Global Energy Policy, Saudi Arabia has responded to China’s mediation in part because of the economic ties. This information was provided to MEE.
The arrangement with Iran is customer service for the Saudis. “They view China as their most valuable customer, so it is imperative that they fulfil all of China’s requirements.
Following Russia’s invasion of Ukraine, China and Russia have also strengthened their connections to one another.
Moscow was the meeting between China President Xi Jinping and Russian President Vladimir Putin. The United States of America has reported that China is considering selling Russia certain weapons. In addition, Russia and China are talking about the possibility of building a pipeline that would reroute the country’s natural gas exports from Europe to Asia.
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