Iran has lowered the price of oil to compete with Russia in China

China became one of the main importers of Russian and Iranian oil after these countries were subjected to Western sanctions.

Iran has increased the size of the discount on exported oil due to competition with Russia in the main market for both countries – China. Bloomberg reported this with reference to traders on Monday, July 4th.

Iranian Light and Iranian Heavy were selling approximately $ 10/bbl cheaper than Brent futures against a $ 4-5/bbl discount before Russia’s war against Ukraine. Thus, the price of Iranian oil is approximately comparable to the price of contracts for the supply of the Russian Urals in August.

The agency said China has become one of Russia’s and Iranian’s major importers of oil after these countries came under Western sanctions. Meanwhile, the recovery of economic activity in China after the coronavirus lockouts promises strong growth in fuel demand. This leads to competition between Iran and Russia with China.

Meanwhile, in the official statistics of the PRC, since the end of 2020, Iran’s oil imports were recorded only according to the results of three months, including January and May of this year. However, data from independent agencies show that Iran maintains stable supplies to China. Thus, according to Kpler, Iran exported more than 700 thousand barrels of oil per day to China in May and June after a slight drop in supplies in April.

It was previously reported that the G7 would limit the price of Russia’s oil to its value. The price cap could hit Russia’s revenues by actually lowering energy prices.

Under the US plan, Ukraine’s allies will pay Russia no more than the cost of production for its oil. Russia’s oil continues to flow into world markets, helping the global economy, but the Russian Federation will receive less money for it.

News from Athletistic in the Telegram. Subscribe to our channel Athletistic