Reuters: China's newest refinery doubles oil imports from Russia after sanctions

China's new Shandong Yulong Petrochemical refinery is increasing its imports of Russian oil to compensate for the drop in supplies after the UK imposed sanctions on it. About writes Reuters, citing informed sources.

Shandong Yulong Petrochemical is the newest major refinery in the eastern province of Shandong with a capacity of 400,000 barrels per day. The company is operating at more than 90% of capacity.

According to the agency's sources, in November the refinery will receive 15 batches of Russian oil, mostly ESPO, but also Urals and Sokol.

This is a record volume of purchases – 370,000 to 405,000 barrels per day, almost twice the average level of Yulong's previous supply.

The decision to increase purchases from Russia was made after the UK and the European Union imposed sanctions on it in October.

After that, several suppliers from the Middle East and Canada canceled contracts with Yulong which created a shortage of raw materials.

Amid new restrictions from the US and EU, other major buyers of Russian oil – Chinese state-owned importers and Indian refineries – have temporarily suspended purchases. This left the Russian brands ESPO and Urals without some of their markets.

According to sources, Shandong Yulong Petrochemical has also intercepted several shipments of oil originally destined for Unipec, the trading arm of state-owned Sinopec, which has temporarily suspended operations with Russian oil for fear of secondary sanctions.

• October 15, United Kingdom expanded sanctions against Russia, including 35 companies and five individuals. The restrictions are related to "doing business in a sector of strategic importance to the Russian government, namely in the energy sector".