Gazprom Neft Sells First Arctic Oil Cargo to China

Russia’s state-run Gazprom Neft has sold its first Arctic oil cargo to China to ChemChina, according to Reuters

It is reported that 144,000 tonnes of light Novy Port oil grade were exported to the Chinese port of Yantai from Russia’s north-western city of Murmansk, using the Northern Sea Route (NSR) through Russia’s Arctic waters. Gazprom usually supplies ESPO Blend crude oil to China via a pipeline, selling the grade to a wide range of refiners including ChemChina.

This landmark sale is a result of Europe shunning the Arctic oil due to the coronavirus pandemic, whilst China kept buying.

Russia is investing heavily in the NSR which allows it to reduce delivery times. Oil shipments eastbound from Russia to Asia are rare as thick ice makes it economically viable in the summer only, with costs much higher.