Russia oil exports to China to rise less than expected in 2014

December 30, 2013

Russia, the world's largest crude oil producer, will export less oil than previously expected to China in 2014, pipeline monopoly Transneft said on Tuesday, as the Kremlin plays a balancing act between Asia and Europe. Transneft said on its web site that Rosneft would export an additional 600,000 tonnes (12,000 barrels per day) to China via the East Siberia-Pacific Ocean (ESPO) pipeline spur from Skovorodino near the border to Mohe in northern China.

The link, the main route for oil from Russia to China, had previously been expected to pump 2 million additional tonnes next year. "We received a letter from Rosneft. An additional 600,000 tonnes will (shipped) via Skovorodino-Mohe spur," Transneft's vice president Mikhail Barkov is quoted as saying.

He said that the volumes would total 15.6 million tonnes next year, which could mean a decline from the 15.8 million tonnes expected this year according to Reuters calculations. This is less than the more than 17 million tonnes previously expected by Transneft and traders, and would play at the hands of Europe, which has been anticipating dwindling supplies from Russia at the expense of increasing flows to China.

"Rosneft is fulfilling its contractual obligations to its Chinese partners in accordance with the conditions of the agreement," a Rosneft spokeswoman said in emailed comments. State-run Rosneft, Russia's largest oil company, has struck agreements to almost triple oil supplies to China in coming years from the around 300,000 barrels per day (15 million tonnes a year) it ships there currently.

Copyright, Business Recorder, 2013.