Russian oil has found new markets in India, China and other allies following the implementation of sanctions. (Photo by Letopisec via Shutterstock)

Major Chinese refineries have taken a renewed interest in Russian oil imports, forcing smaller independent refineries to look elsewhere, data suggests.

While Western governments have imposed ongoing sanctions following Russia’s invasion of Ukraine, China remains committed to purchasing Russian crude oil. Sanctions have caused Russia to heavily discount its oil exports, prompting refiners such as Hengli Petrochemical Jiangsu Eastern Shenghong to start purchasing it from March.

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Between November and January, smaller Chinese refineries, known as “teapots”, took on a majority of Russian oil supply.

According to Reuters, given the re-arrival of large refining companies has led these smaller companies toward Russian Arctic oil grades, as well as Iranian and Venezuelan oil, amid rising prices.

State refiners Sinopec and Petrofac resumed the import of Russian Urals crude in February after a brief pause late into last year.

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Amid Western sanctions, Russia has turned to its allied nations as importers in the last year. China is the second-largest importer of Russian crude oil following India.

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The rise in imports comes soon after demand for transport fuel in China has risen, following the lifting of the “zero-Covid” policy pursued by the Chinese government.

Reuters reporters found that Petrochina will receive about 1.5 million barrels of Urals crude later this month onboard Aframax tankers NS Arctic and Crudemed at its 200,000 barrels-per-day refinery in Qinzhou, Guangxi province. The data was drawn from Refinitiv and Kpler.

“It’s not a surprise to see China’s state-owned refiners taking Russian oil at this moment,” a China-based oil trader told reporters. “Prices of Urals oil are well below the price cap, and the cheap feedstocks are timely as they would increase refining throughput when China’s demand picks up”.