(Reuters) – Top Chinese refining major Sinopec Corp will prioritise “risk control” in purchasing Russian oil, which has similar quality for its value versus competing global supplies, a top company executive said on Monday.
The remarks followed a recent move by China’s state-owned oil importers including Sinopec that have shied away from Russian oil purchases this month as companies assess compliance following recent U.S. sanctions on Moscow.
Company president Zhao Dong told an earnings briefing in Hong Kong that Sinopec is “fairly capable” of securing crude oil supplies, including via long-term supply agreements of multiple partners.
Sinopec did diversify procurement sources to fill the supply gap in Russian oil with shipments from West Africa, the Middle East and Brazil, after Washington’s January 10 sanctions on Russian oil sales briefly stalled trade and sent freight cost soaring.
Zhao also said China’s tariffs on U.S. oil and gas have a “limited” impact on Chinese imports and that U.S. oil supply makes up a small share in Sinopec’s crude oil purchases.
For the whole of 2024, U.S. supplies accounted for 1.7% of China’s crude imports, while U.S. liquefied natural gas accounted for roughly 5.4% of China’s purchases.
Sinopec reported on Sunday a 16.8% decline in 2024 net profit, citing lower crude oil prices and the accelerated development of the new energy vehicle (NEV) industry.
(This story has been refiled to say ‘long term,’ not ‘term-term,’ in paragraph 3)
(Reporting by Alison Lui in Hong Kong, writing by Chen Aizhu in Singapore; Editing by Muralikumar Anantharaman and David Evans)
