China and India are buying Russian oil by paying for it above the Price Cap. What will the West do?
China and India, the main customers of Russian crude in recent months, bought Russian cargoes in April at prices above the $60 a barrel ceiling set by the G7, Reuters reported , citing traders and their own calculations.
Russia's top Urals crude is now trading above the $60 price ceiling and has so far been destined mainly for India and China, according to data from Refinitiv Eikon cited by Reuters.
India accounts for more than 70% of Urals shipments in April, while China has received 20% so far, according to Reuters estimates.
China and India have not joined the so-called Price Cap Coalition, made up mostly of Western countries, which has capped Russian crude prices if cargoes use Western insurance, shipping and financing.
Following OPEC+'s announcement of further cuts through the end of the year, the price of the Urals rose, threatening the price cap imposed in an attempt to hurt Russia's oil revenues.
Russia was China's top supplier of crude oil in January and February, overtaking Saudi Arabia, which was China's top oil supplier last year, according to data from China's customs. As China accelerated its purchase of cheap Russian crude oil at discounts relative to international benchmarks, China's imports of crude oil from Russia increased by 23.8% year on year to 1.94 million barrels per year. day (bpd) in January and February 2023.
India, for its part, is also ramping up imports of Russian oil to record levels. In February, Russia remained India's top oil supplier for the fifth consecutive month.
More recently, weekly exports of Russian crude oil by sea returned to above 3 million bpd in the week to April 14, after hitting an eight-week low in the previous week, data from Vessel Monitoring Services showed. compiled by Bloomberg earlier this week. Most of these exports go to China and India.
At this point, what will the western G7 countries that have imposed the price cap do? Will they impose sanctions on China and India or on the banking and insurance institutions that allowed the transaction? Or will they simply declare their full-blown impotence?
Thanks to our Telegram channel you can stay updated on the publication of new articles from Economic Scenarios.
The article China and India are buying Russian oil above the Price Cap. What will the West do? comes from Economic Scenarios .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/cina-e-india-stanno-comprando-petrolio-russo-pagandolo-oltre-il-price-cap-loccidente-che-fara/ on Tue, 18 Apr 2023 14:36:03 +0000.