China’s state-owned oil companies reduced their purchases of Russian oil in March: two halted imports entirely, while two others cut volumes. This move was a response to U.S. sanctions against Russian oil producers, Reuters reports, citing sources.

What Is Known About the Purchase Restrictions

On January 10, 2025, the U.S. administration imposed sanctions on key Russian oil companies, including Gazprom Neft and Surgutneftegaz, as well as more than a hundred tankers and insurance companies servicing Russia’s oil sector.

Amid the sanctions, Chinese state-owned traders, including Zhenhua Oil, suspended purchases of Russian oil that was scheduled for loading in March. Companies are wary of dealing with counterparties listed in U.S. sanctions.

The Chinese government has taken a wait-and-see approach. Beijing is monitoring developments around negotiations on ending the war in Ukraine. Purchases of Russian oil could resume if U.S. sanction pressure eases.

How Sanctions Have Affected Russian Oil Exports

Gazprom Neft and Surgutneftegaz control nearly a third of Russia’s seaborne exports of ESPO-grade oil from the Far East—about 1.2 million tons per month. The main buyers remain Chinese state-owned companies, which purchase around 1.3 million barrels of Russian oil daily. The remainder is imported by independent refineries.

Despite the sanctions, Russia remains China’s largest oil supplier, accounting for 20% of the country’s total imports. Meanwhile, Washington continues to tighten sanctions on Russia’s energy sector, complicating payments for oil contracts due to restrictions on sanctioned banks.