Trading for March shipments of Russian crude in Asia halted due to a significant price gap between buyers and sellers in China, exacerbated by rising tanker charter rates following new U.S. sanctions on Jan. 10. These sanctions led to a sharp increase in costs, prompting some Chinese and Indian buyers to avoid sanctioned vessels.

As a result, bids for March delivery of Russian ESPO Blend crude from the Pacific port of Kozmino surged to $3 to $5 a barrel, influenced by rising Aframax tanker rates. Before the sanctions, strong winter demand and higher prices for Iranian crude had raised ESPO premiums to nearly $2 a barrel.

Bharat Petroleum Corp's CFO noted that the company has not received new supply offers for March and anticipates fewer shipments than in previous months. In 2024, Russian oil constituted 36% of India’s imports and nearly 20% of China’s.

The sanctions affect about 42% of Russia's seaborne oil exports, mainly to China. India’s Oil Minister stated that tankers laden with Russian oil must be offloaded by Feb. 27, with payments due by March 12. Reports also indicate delays in offloading sanctioned tankers in China despite meeting exemption requirements.