New U.S. Sanctions on Russian Oil Supply to Affect China and India, Pushing Them to Seek Alternative Sources

New U.S. Sanctions on Russian Oil Supply to Affect China and India, Pushing Them to Seek Alternative Sources

January 12, 2025 — The new U.S. sanctions will impact Russia's oil supply, especially to major buyers like China and India. On Friday, the U.S. Treasury imposed sanctions on Russian oil producers Gazprom Neft and Surgutneftegas, along with 183 oil tankers, aiming to reduce Moscow's revenue.

Now, refiners will be forced to import more oil from the Middle East, Africa, and the Americas, resulting in an increase in spot crude prices and freight costs, according to traders and analysts.

Independent refiners in China have warned that any disruption to the ESPO supply from Russia will force them to cut down on production. In 2024, Russia shipped 530 million barrels of oil, creating a supply crunch in the market.