Export volumes from Russia to China have doubled following the extension of the East Siberian-Pacific Ocean oil pipeline that began operating on 1st January.
The extension that was agreed in 2013 will increase output by twofold from 15 to 30 million tonnes annually or almost 22 million barrels and will serve in increasing China’s influence across the continent.
Meanwhile, Russia’s market share within the Chinese oil industry will also increase drastically as the importer posts record levels of consumption to become the world’s top consumer of the commodity.
PetroChina will purchase the crude of Russian state-owned Rosneft and will then process the oil at three refineries in Northeast China – one of which was reportedly undergoing a capacity extension worth $880 million that will increase capacity to 400,000 bpd.
Last year Russia became the biggest oil supplier to China, with November crude exports totaling 5.12 million tonnes or approximately 1.25 million barrels a day – 11% more than November 2016.
A combination of the growth of energy demand in China and the nation’s falling production have resulted in this increase in imports from Russia and the US, which began exporting crude in vast quantities, with average shipments to China at 180,000 bpd from January to September alone.