China Stocks Up on Cheap Oil
China is taking advantage of reduced oil demand in Europe amid the coronavirus pandemic to replenish its oil reserves from Russia, Deutsche Welle reports.
According to stock exchange information, China has already purchased 1.6 million tonnes of Russian oil, which will be delivered by sea within the next 4 months, Reuters reported. It is emphasized that the Chinese not only take advantage of the decline in demand in Europe, but also the low prices of Russian raw materials.
Russian oil companies are pleased with China's bids because, in addition to the expected recession in Western industrialized countries, they are also affected by the price war with Saudi Arabia, which is flooding the market with cheap oil in the fight to expand its market share.
Experts suggest that with the Russian oil purchased, China is likely to replenish its strategic reserves.
According to analysts at the Wood Mackenzie consulting firm, the boom in strategic oil trade in Korea this year could reach 1.15 billion barrels. This volume is sufficient to satisfy the needs of the country for 83 days.
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