What's happened
Major Chinese state-owned refiners and Indian companies are suspending or reducing Russian oil purchases amid US sanctions and fears of secondary sanctions. This has significantly impacted Russian crude exports, especially the ESPO grade, with prices plunging and buyers seeking alternative sources. The US deadline for winding down dealings is November 21, 2025.
What's behind the headline?
The recent halt in Russian oil imports by Chinese and Indian refiners signals a significant shift in global energy flows. State-owned Chinese firms, such as Sinopec and PetroChina, have paused seaborne purchases, citing fears of secondary sanctions, while Indian refiners are actively reducing their reliance on Russian crude to avoid US penalties. This coordinated recalibration will likely lead to a substantial re-routing of Russian exports, with sellers seeking new markets in Africa, Latin America, and the Middle East. The plunge in ESPO crude prices, now discounted by around $0.50 per barrel to Brent, underscores the market's response to reduced demand. These disruptions will tighten supply in traditional markets and could elevate prices for alternative sources. The US sanctions deadline of November 21, 2025, will be a critical juncture, forcing many buyers to finalize their withdrawal from Russian oil. This shift may accelerate the diversification of Russian crude destinations and prompt Russia to seek new buyers or payment mechanisms, potentially destabilizing existing supply chains and geopolitical alignments.
What the papers say
The Moscow Times and The Japan Times both report that Chinese state refiners like Sinopec and PetroChina have paused Russian crude imports due to fears of secondary sanctions, with estimates of Chinese imports from 250,000 to 500,000 barrels per day. The Moscow Times highlights that Indian refiners, including Reliance Industries and Indian Oil, are scaling back Russian purchases, with Reliance planning to fully align with Indian government guidelines. Both sources note the US sanctions deadline of November 21, 2025, as a key driver of these changes. The articles differ slightly in emphasis: The Japan Times emphasizes the impact on Chinese prices and the broader market, while The Moscow Times provides detailed insights into Indian refiner strategies and the potential for rerouting Russian crude to new markets. Overall, the consensus is that these sanctions are causing a significant realignment in Asian energy markets, with long-term implications for global oil flows.
How we got here
Following US sanctions targeting Rosneft and Lukoil, global buyers, especially in China and India, have begun to suspend or reduce Russian oil imports. Indian refiners, historically major buyers, are recalibrating their supply chains to comply with new restrictions, while Chinese state companies are assessing risks amid fears of secondary sanctions. These developments are part of broader geopolitical tensions and efforts to limit Russia's energy revenue.
Go deeper
Common question
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How are global energy markets adjusting to sanctions and shifting supply chains?
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The PJSC Lukoil Oil Company is a Russian multinational energy corporation headquartered in Moscow, specializing in the business of extraction, production, transport, and sale of petroleum, natural gas, and petroleum products.
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PJSC Rosneft Oil Company is a Russian integrated energy company headquartered in Moscow. Rosneft specializes in the exploration, extraction, production, refinement, transport, and sale of petroleum, natural gas, and petroleum products.
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Reliance Industries Limited is an Indian multinational conglomerate company headquartered in Mumbai, Maharashtra, India. Reliance owns businesses across India engaged in energy, petrochemicals, textiles, natural resources, retail, and telecommunications.
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PetroChina Company Limited (Chinese: 中国石油天然气股份有限公司) is a Chinese oil and gas company and is the listed arm of state-owned China National Petroleum Corporation (CNPC), headquartered in Dongcheng District, Beijing. The company is c
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India, officially the Republic of India, is a country in South Asia. It is the second-most populous country, the seventh-largest country by land area, and the most populous democracy in the world.
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Indian Oil Corporation Limited, d/b/a IndianOil, is an Indian government corporation. It is under the ownership of Ministry of Petroleum and Natural Gas, Government of India headquartered in New Delhi.