Sudden! Biden announced a ban on oil imports from Russia, the United Kingdom and the United States! Will crude oil flow to China?

It is reported that on March 8 local time, the White House issued a statement on its website, saying that US President Biden officially signed an executive order prohibiting the United States from importing oil, liquefied natural gas and coal from Russia.
The executive order includes: banning the United States from importing Russian crude oil and some petroleum products, liquefied natural gas and coal. Last year, the United States imported nearly 700000 barrels of crude oil and refined oil from Russia every day. This measure will cost Russia billions of dollars in revenue every year; Banning new U.S. investment in Russia's energy sector; The United States is prohibited from providing funds or support to foreign companies investing in energy production in Russia.
At the same time, Biden said he would reduce the United States' dependence on foreign oil and fossil fuels: he promised to release more than 90 million barrels of oil from strategic oil reserves this fiscal year.
In addition, on March 8 local time, the UK announced that it would gradually stop importing oil and corresponding petroleum products from Russia by the end of this year. The UK said it was giving the market and enterprises enough time to find import substitutes accounting for 8% of the demand.
On Tuesday, international oil prices rose sharply. Oil prices in New York and London Brent rose by more than 7% at one time. As of the closing, the futures price of light crude oil for April delivery on the New York Mercantile Exchange closed at US $123.70 a barrel, up 3.6%; London Brent crude oil futures for May delivery closed at US $127.98 a barrel, up 3.87%.
According to Reuters, crude oil prices rose again on Wednesday after the US announced the ban. The latest report of the global benchmark Brent crude oil was US $131.39 a barrel, up 2.66% on the same day.
Russia warned earlier this week that if the West blocked its oil exports, oil prices could soar to $300 a barrel and could close the main gas pipeline to Germany.
With the Russian oil ban "on the table", traders predict that oil prices may reach $200 a barrel by the end of this month, more than double the price at the beginning of the year.
Yesterday, the price of low sulfur fuel oil increased by another $100 per ton, and has increased by one third since the end of February to about $1000 per ton, which has increased the cost of operating super large container ships on the Asia Nordic round-trip route by millions of dollars.
Although shipping companies have reported huge profits in the past year, the surge in fuel costs will force shipping companies to readjust their performance expectations for the whole of 2022. Of course, shipping companies are also likely to recover costs in the form of emergency fuel surcharges and reduce their financial impact more through slow navigation. A week ago, it was reported that the carrier would charge an emergency fuel surcharge within a few weeks.
At the same time, shipping companies also began to worry about the decline in demand. Not in the trans Pacific region, there was no sign of weakening demand from American consumers, but in Asia Europe trade routes. Even before the conflict between Russia and Ukraine, there were signs that the demand of European consumers began to slow down because they were struggling with higher energy costs and other inflationary pressures.
In addition, some market analysts said that given that the west is leaving the Russian economy, China may take advantage of Russia's discounted energy supply and investment opportunities.
China has opened its market to all Russian wheat exports and is expected to continue to boost Russian crude oil - possibly below the global spot price, which has reached extreme levels. China's refiners will try to obtain low-cost alternatives to crude oil, which will enable western countries to obtain low-cost alternatives.
"A lot of oil and gas will flow out of the European market, first to China," Tatiana mitrova of Colombia's global energy research center told the New York Times
Source: sohang.com
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