A new trade truce between the US and China could open the door for American oil exports. The opportunity arises as China, the world’s top importer, looks for new supplies.
Chinese refiners are currently in a “buyers’ strike” against Russian oil. This is driven by new US sanctions on Rosneft and Lukoil, and the UK/EU blacklisting of Yulong Petrochemical, which has terrified “teapot” refiners.
This retreat has hit Moscow hard, causing ESPO crude prices to plunge and affecting 400,000 barrels a day.
However, the situation is “muddled.” A high-stakes summit between Donald Trump and Xi Jinping was silent on the oil issue, leaving refiners guessing.
This lack of clarity is a problem, as are domestic quota shortages for teapots, which may limit their ability to take on new US supplies.