This week a report from Bloomberg, citing data from intelligence firm Kpler, revealed that China is continuing to ramp up its purchases of Russian oil.

The report detailed that Beijing imported an average of 1.66 million barrels of Russian crude and fuel oil per day in January, beating the previous record, set in April of 2020. China purchased the entire monthly loading of Russia’s ESPO grade oil, its Arctic grades, and the flagship Urals grade oil.

China and India have been competing to be the biggest buyer of Russian crude since Western sanctions over the conflict in Ukraine caused Russia to discount its sales in a search for new buyers willing to ignore the Western sanctions. In December, the EU and UK banned imports of Russian crude, as the EU and G7 countries set a price cap on sales of Russian seaborne crude.

As China is reopening its economy following the elimination of the Covid-19 restrictions which had been repeatedly shutting it down, it has been ramping up its oil purchases. A report by the International Energy Agency asserted that the key driver of global oil demand this year will be recovering Chinese consumption. It estimated it will rise to 101.9 million barrels per day.

Demand for Russian crude is primarily being driven now by its relatively low price. Currently Russia’s flagship grades are priced well below Europe’s Brent crude and similar West African grades. In January, Russian Urals grade averaged $49.48, as Brent was trading at $82 per barrel.

Russia averaged 8.2 million barrels per day in exports in January according to the IEA, which noted the country was continuing to increase exports month to month.