China snaps up all Russian ESPO crude cargoes for August loading

Tsvetana Paraskova Fri, July 24, 2026 at 2:45 AM PDT | 2 min read

Chinese refiners have purchased all crude oil cargoes scheduled for loading from Russia's Far East port of Kozmino in August — weeks earlier than usual — according to traders familiar with the market who spoke to Bloomberg on Friday. The accelerated buying comes as risks to Middle Eastern supply spiked this week following attacks on tankers in the Red Sea.

China has been snapping up the cargoes at a faster pace, driving the price of Russia's Far Eastern crude blend ESPO to a discount of just $1 per barrel relative to ICE Brent, down from a discount of between $3 and $4 per barrel two weeks ago, Bloomberg's trade sources reported.

Escalating Middle East Risks

Two weeks ago, risks to crude oil supply from the Middle East rose again after the ceasefire collapsed following Iranian attacks on vessels in the Strait of Hormuz. Since then:

• The U.S. has been striking Iranian targets daily.
• Iran has been firing missiles at U.S. military bases and assets across the Middle East.
• The U.S. has reinstated the blockade aimed at stopping Iranian oil exports.

The Strait of Hormuz is once again closed, and the steady flow of tankers that managed to exit the Persian Gulf abruptly ended after just three weeks.

This week, Brent crude oil prices hit $100 per barrel again, as the Strait of Hormuz remains almost entirely paralyzed and Iran-aligned Houthi forces in Yemen target tankers in the Bab el-Mandeb Strait in the Red Sea.

China's Response

As a result, Chinese buyers are wasting no time securing alternatives to Middle Eastern supply well in advance. Typically, they wait until the end of the window for next month's loading of Russia's ESPO crude, given that the journey from Kozmino to China's east coast takes only about a week.

However, with spiking prices and growing fears that supply from the Middle East is constrained at both key chokepoints, China's refiners are choosing to stock up on Russian crude that can reach import terminals in just seven days.

By Tsvetana Paraskova for Oilprice.com

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