China eyes cheap Russian energy – media

China’s top liquefied natural gas (LNG) importers are seeking to purchase additional shipments from sanctions-hit Russia to take advantage of cheap prices, Bloomberg reported on Monday, citing people with knowledge of the matter. The increased purchases are reportedly intended for replenishing storage tanks before prices rise again this summer.

Chinese state-owned companies Sinopec and PetroChina are among those taking part in the discussions, sources said. Some importers are considering using Russian firms to participate in LNG purchase tenders on their behalf to hide their procurement plans from overseas governments, they added.

The purchases come as some countries, including the US and the UK, have placed a ban on imports of Russian energy as part of sanctions over the conflict in Ukraine. The EU has refused to do so, while the US and Britain continue to buy Russian oil and gas.

Meanwhile, Russian LNG is trading at over a 10% discount to normal North Asia shipments on the spot market, traders say. Spot prices for the super-chilled fuel have soared to record highs amid tightening supplies.

Traders told Bloomberg that China’s oil refiners have been also been discreetly buying cheap Russian crude, with several shipments already purchased in the last few weeks.

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