Sinopec Shanghai Petrochemical, one of the largest crude oil buyers in China, has announced a reduction in its purchases from Russia during the first quarter of 2024. This development marks a shift for the Chinese state-owned petrochemical company, which more than doubled its procurement from Russia earlier in the year. The announcement was made by Du Jun, the vice president and chief financial officer of Sinopec Shanghai Petrochemical, during the company's annual earnings briefing held in Hong Kong.
Du Jun spoke to Nikkei Asia, shedding light on the company's recent shift in procurement strategy. However, he did not elaborate on the specific reasons for the decrease in purchasing Russian crude. He noted a "very big change in policy brought about by Trump," referring to the former United States President Donald Trump, as a factor influencing their decision. Despite this significant change, the details of these policy impacts remain undisclosed.
China has been a major buyer of Russian oil, particularly since the invasion of Ukraine over three years ago. Russia continues to be a formidable oil producer and exporter, making this recent reduction in crude procurement by Sinopec Shanghai Petrochemical noteworthy. The company's decision to reduce purchases comes at a time when global oil markets are closely observing trading patterns amid geopolitical tensions and policy changes.
Sinopec Shanghai Petrochemical's decision contrasts with its previous approach when it more than doubled its procurement from Russia earlier this year. This move reflected China's continued interest in securing energy resources from one of its major suppliers. However, the shift underscores the complex interplay of geopolitical factors affecting global oil trade.