China No Longer Top Buyer of Russian Oil

India overtook China as the No. 1 importer of Russian oil in July.

A record 2.07 million barrels per day of Russian oil went to the South Asian country, Reuters cited industry sources as saying. That's compared to the 1.76 million barrels per day imported by China—a year-on-year drop of 7.4 percent and the lowest amount this year.

Russia's economy, subject to heavy international sanctions since President Vladimir Putin's 2022 invasion of Ukraine, has come to rely on heavily discounted oil exports to India and China, the world's most populous countries.

Chinese trade with Russia has soared since the war began, rising by 26 percent to a $240 billion high last year, though Chinese banks wary of U.S. secondary sanctions have made cross-border transactions increasingly difficult for Russian traders in recent months.

New Delhi-Moscow trade has also boomed, with the Indian trade ministry posting a record $65.7 billion turnover in 2023.

However, this resulted in a ballooning trade deficit, with international sanctions imposed over the war complicating Indian efforts to boost exports to its Russian partner.

Chris Weafer, CEO of Eurasia-based strategic consultancy Macro-Advisory, believes this could be one of the factors behind Indian Prime Minister's trip to Ukraine this week.

[India] now imports so much Russian oil that the trade deficit has grown from only $5 billion in 2021 to approaching $60 billion this year," he told Newsweek. "Modi wants India to export more products to Russia to help reduce this deficit, but the financial settlement restrictions make that difficult."

Russia's trade with China boomed following the international sanctions imposed over Moscow's invasion of Ukraine, with oil accounting for nearly two-thirds of that trade after Russia lost much of the European market for its oil.

The Indian and Russian foreign ministries did not immediately respond to written request for comment.

The drop in Chinese oil imports, down by 22 percent since December and 30 percent since March, is a concern for Russia.

In 2023, Russia topped Saudi Arabia as China's largest source of oil, accounting for almost 20 percent.

Oil imports from Saudi Arabia in July were up by 13 percent, or 1.51 million barrels of oil year on year.

Meanwhile, oil shipments from China's third-largest source for the fossil fuel, Malaysia, were up by 61 percent year-on-year.

The Southeast Asian country is a major regional hub for oil shipments, including those reportedly from Iran and Venezuela. These countries are subject to international sanctions over their nuclear programs and political regimes, respectively.

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