Key Points
- President Trump is pressuring China and India to stop buying Russian oil.
- China, India, and Turkey are the biggest buyers because the oil is sold at a discount.
- Russia successfully evades the G7 price cap by using a “shadow fleet” of tankers.
- Russia is still earning billions from oil sales, with $12.6 billion in June alone. This oil money directly funds Russia’s war effort in Ukraine.
The Trump administration is turning up the heat on China and India, pushing them to stop buying Russian oil and cut off a key source of funding for the Kremlin’s war in Ukraine. This pressure is part of a broader U.S. strategy to force Russian President Vladimir Putin to agree to a ceasefire.
However, the two Asian giants, along with Turkey, are showing no signs of stopping, thanks to one major incentive: it’s cheap.
After the European Union banned most Russian seaborne oil in early 2023, Russia simply rerouted its oil exports to Asia. Since then, China, India, and Turkey have become the top three buyers. Before the war, India bought very little oil from Russia, but now it’s a major customer.
The biggest draw is the price. Russian oil sells at a discount to the global benchmark, allowing refiners in these countries to boost their profits while securing their energy needs.
This continues despite a price cap imposed by the G7 nations. Russia has largely evaded the cap by using a “shadow fleet” of older tankers with non-Western insurance, making it difficult to enforce the rules.
The strategy is working for Moscow. Russia still earned a massive $12.6 billion from oil sales in June alone, and its oil exporters are projected to bring in $153 billion this year. This steady flow of cash is a lifeline for Russia’s economy, supporting its currency and directly funding its ability to wage war and purchase weapons.
