Investing.com — The price of shipping Russian ESPO to China has more than tripled following recent U.S. sanctions on Moscow’s oil industry, Bloomberg reports. Traders expect these rates to rise further.
The cost of transporting ESPO oil from the port of Kozmino on Russia’s east coast to China soared Monday to $5 million to $5.5 million. That is a significant increase compared to the pre-sanctions cost of $1.5 million, according to traders familiar with the route who spoke on condition of anonymity due to the sensitivity of the issue.
Last week, the United States expanded sanctions on oil tankers and targeted two Russian companies that control more than a quarter of the OPEC+ oil-producing nation’s seaborne exports. These companies have been blacklisted along with insurers and traders. Sanctioned vessels were responsible for transporting about 22% of the crude oil transported by sea in 2024, according to the International Energy Agency.
The sanctions have had immediate effect and tankers carrying ESPO and another Russian class, Sokol, are now anchored off the Chinese coast. This information is based on vessel tracking data. ESPO was popular among Chinese oil refiners due to its short delivery distance.
Most tankers traveling between Kozmino and China are Aframaxes, capable of carrying up to 750,000 barrels.
Before the latest U.S. sanctions, ports in Shandong province had reservations about doing business with tankers that had already been sanctioned. The hesitation followed warnings from major terminal operators. Shandong Province is where most of China’s independent oil refineries are located.
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