Putin Presents China With Another $2.2 Billion Gift
- 20.03.2026, 19:36
At the expense of oil discounts.
Discounts on oil, which oil companies were forced to give to Chinese refineries, have again resulted in billions of dollars in lost revenue for them.
At the end of 2025, the total volume of discounts given to Chinese refineries in monetary terms reached $2.2 billion, experts of the Gaidar Institute calculated on the basis of Chinese customs statistics, writes The Moscow Times.
The Moscow Times.themoscowtimes.com/2026/03/20/v-rossii-rezko-podorozhali-pivo-i-vodka-a190447">The Moscow Times.
A year earlier, according to their estimates, oil discounts for China cost the oil industry $1.45 billion, in 2023 - $3.85 billion, and in 2022 - $4.44 billion. As a cumulative result, over the four years of oil supplies to the Chinese market, Beijing saved almost $12 billion, or a trillion rubles at the current exchange rate, through discounts - an amount comparable to the annual budget of the Moscow region (1.2 trillion rubles) or five annual budgets of such regions as the Voronezh or Volgograd regions.
The discount on Russian oil for China grew significantly again last year, according to experts from the Gaidar Institute. After the tightening of U.S. sanctions and the blacklisting of Rosneft and Lukoil, average barrel prices from Russia in the fourth quarter were 8.3% lower than supplies from other countries. By comparison, the average discounts were around 3% at the beginning of the year, and in 2024 did not exceed 5% all year.
In physical terms, China reduced its purchases of Russian oil by 8% to 91.4 million tons in 2025. But due to discounts and falling prices, revenues from oil exports to China fell by 20% to $45.9 billion.Supplies of oil products to the Chinese market also sagged - by 40% for heavy distillates and 17% for light distillates, to $3.1 billion and $1.9 billion respectively, according to calculations by the Gaidar Institute.
The war in Iran, which has paralyzed the Strait of Hormuz, a key artery of global oil trade, has sharply increased demand for Russian crude from Chinese refineries. According to Reuters, China's largest state-owned oil companies, which have been on pause since November when U.S. sanctions took effect, have joined the buying spree.
Prices for Russia's Urals grade have soared to $70 a barrel and higher, and this promises "a direct financial effect for the budget," said Vladimir Chernov, an analyst at Freedom Finance Global.
"Each $10 per barrel increase in the price of oil brings about $1.6 billion in additional revenues to the budget per month. The current Urals price is almost $40 higher than the budgeted $59, which means that additional oil and gas revenues can reach about $6-6.5 billion monthly," Chernov estimates.
"At this price level, it will potentially take about 8-10 months to compensate for the expected federal budget deficit of about $50-60 billion," the expert points out.