Russia Offers Record-Level Oil Discounts to China
Following the trade agreement signed by Trump with India, which foresees New Delhi abandoning Russian raw materials, Moscow has raised the oil discounts offered to China to record levels.
According to January 2026 data, while India’s purchases decreased, shipments to China reached the second-highest level since Russia’s military intervention in Ukraine. U.S. President Donald Trump announced on Monday that a trade agreement had been signed with India, stipulating the abandonment of Russian raw materials.
As Indian refineries have reduced their purchases in recent months, Russian suppliers turned to China, offering significant concessions in prices.
The discount on ESPO crude shipped from the Pacific port of Kozmino to Chinese ports rose to about $9 per barrel compared to Brent crude.
Market participants speaking to Reuters noted that this gap, which had hovered around $7–8 in recent months, has reached a record level.
In the case of Urals crude, which was initially destined for India but partially redirected to China, the discount reached $12 per barrel. Brent crude traded between $65.8 and $69.8 this week.
Chinese Buyers Prefer Russian Oil Over Iranian Oil
Vortexa analyst Emma Li stated that Chinese buyers are taking advantage of the discounts on Russian oil, with some reducing their purchases of Iranian oil in order to import more from Russia.
Li added that with India’s purchases continuing to decline, discount rates—especially for Urals crude—could increase further.
While these prices at importing ports include shipping costs, prices at Russian loading ports remain at much lower levels.
Shipment Data Shows Widening Gap Between India and China
According to Argus Media data, while Brent crude traded between $65.3 and $70.5 last week, ESPO crude averaged $48.65 at Kozmino, and Urals sold for $40.34 at Baltic ports.
These figures reveal discounts of approximately $20 to $30 per barrel.
Throughout 2025, India’s daily average purchases ranged between 1.4 million and 2 million barrels, but in January 2026 this amount fell to 1.1 million barrels.
During the same period, China’s purchases rose to 1.65 million barrels per day, reaching the highest level since March 2024.
China’s Capacity to Absorb Rising Supply Questioned
JPMorgan analysts predict that following the agreement with the U.S., India’s purchases of Russian oil will decline to between 800,000 and 1 million barrels per day.
However, experts note that unless Chinese state-owned companies become involved, independent refineries will not be able to absorb all of Russia’s surplus supply.
Energy Aspects senior analyst Sun Jianan emphasized that due to rising stockpiles at China’s onshore storage facilities, after the high figures in January and February, a decline in seaborne shipments is expected starting from March.
