AP

China’s Russia dealings irk US, but don’t breach sanctions

May 31, 2022, 6:30 PM | Updated: Jun 1, 2022, 4:37 pm

BEIJING (AP) — China’s support for Russia through oil and gas purchases is irking Washington and raising the risk of U.S. retaliation, foreign observers say, though they see no sign Beijing is helping Moscow evade sanctions over its war on Ukraine.

Beijing’s importance as a lifeline to Russian President Vladimir Putin rose Monday after the 27-nation European Union, the main market for fossil fuels that supply most of Moscow’s foreign income, agreed to stop oil purchases.

President Xi Jinping’s government declared ahead of Russia’s Feb. 24 attack that it had a “no limits” friendship with Moscow and has kept the West guessing about whether it might bail Putin out.

China rejects the sanctions as illegal because the United States, Europe and Japan cut off Russia from their markets and the global banking system without working through the United Nations, where Beijing and Moscow have veto power.

The sanctions don’t prohibit China, India or other countries from buying Russian oil and gas. But President Joe Biden has warned Xi of unspecified consequences if Beijing helps Moscow evade sanctions. That leaves open the risk Chinese companies might be punished by losing access to valuable Western markets.

Beijing appears to be complying. But state-owned companies are buying more Russian oil and gas, which gives the Kremlin export income. They also are potential investors in Russian energy projects as Western companies leave.

“The Biden administration will likely become increasingly exasperated at China’s continued support for Russia,” Neil Thomas of Eurasia Group said in an email.

That increases the likelihood of “unilateral moves to punish Beijing” and “allied coordination on economic security measures aimed at countering China,” Thomas said.

The conflict adds to tension with Washington over Taiwan, Hong Kong, human rights, trade, technology and Beijing’s strategic ambitions.

China poses the “most serious long-term challenge to the international order,” Secretary of State Antony Blinken said in a May 26 speech.

Xi’s government has tried to distance itself from Putin’s war by calling for peace talks, but it avoids criticizing Moscow.

Other governments “must not harm China’s legitimate interests in any way” in dealing with Ukraine, warned a foreign ministry spokesman, Zhao Lijian.

Monday’s decision by EU leaders will cut imports of Russian oil by 90%, according to the head of its executive branch, Ursula von der Leyen. European customers have been paying Russia as much as $1 billion per day for oil, gas and coal.

Mikhail Ulyanov, Russia’s permanent representative to international organizations in Vienna, responded on Twitter: “Russia will find other importers.”

Moscow is tiny as a trading partner for Beijing but an ally against what both resent as U.S. dominance in global affairs.

China sees Russian oil and gas as a way to diversify supplies for its energy-hungry economy. China bought 20% of last year’s Russian crude exports, according to the International Energy Agency. The two sides announced a new 30-year gas contract on Feb. 4, three weeks ahead of Moscow’s attack on Ukraine, that the state newspaper Global Times said will increase annual supplies to China by about 25%.

While the two are friendly, China is taking advantage of the situation to get cheaper energy and favorable business deals, said Maria Shagina of the International Institute for Strategic Studies.

“They would always capitalize on Russia’s isolation,” said Shagina. “But they would be very cautious not to violate sanctions outright.”

On May 24, while Biden was visiting Tokyo, Russian and Chinese warplanes carried out “strategic air patrols” above the Sea of Japan, the East China Sea and the western Pacific. The Japanese government said bombers flew near Japan.

Biden warned Xi during a March 18 video meeting not to give Moscow military or economic aid.

Biden’s national security adviser, Jake Sullivan, said in March that Washington wouldn’t tolerate China or any other country helping Moscow work around sanctions. The White House has criticized Beijing’s “rhetorical support” for Putin.

Washington is “monitoring closely” Chinese dealings with Moscow, the American Embassy said in a written response to questions.

“We have not seen the provision of military equipment,” it said. Asked about economic sanctions and possible violations, the embassy said it had nothing further.

After BP and ExxonMobil announced they were pulling out of Russian oil and gas projects, “there are rumors state-owned Chinese companies might step in and acquire stakes,” said Shagina.

China’s imports from Russia rose 56.6% over a year earlier in April to $8.9 billion, according to customs data. That helped Putin’s government record a current account surplus, the broadest measure of trade, of $96 billion for the four months ending in April.

Washington also is frustrated that India, the No. 3 global oil importer, is buying more from Russia to take advantage of low prices. The Biden administration is lobbying Prime Minister Narendra Modi’s government to stop.

In March, the U.S. government told Asian and European allies that American intelligence had determined China indicated to Russia it would be willing to provide military support for the campaign in Ukraine and financial help to limit the impact of sanctions.

Russia has been expelled from the global SWIFT network for bank transfers.

China’s credit card processor, UnionPay, refused to work with Russian banks after Visa and MasterCard stopped serving them, the Russian news outlet RBC reported in April. It said UnionPay worried it might be hit by “secondary sanctions” and cut off from the Western-controlled global financial system.

China has blocked Russia’s airlines from flying foreign-owned aircraft into Chinese airspace, the Russian news outlet RBK reported. Putin in March threw ownership of the planes into doubt by allowing them to be-registered in Russia to avoid being seized after the European leasing companies were barred from doing business with Russian carriers.

The Civil Aviation Administration of China didn’t immediately respond to a request for confirmation and details.

China gave Moscow an economic lifeline following Western sanctions imposed over its 2014 seizure of Crimea from Ukraine.

Beijing agreed to buy Russian gas in a deal estimated to be worth up to $400 billion over three decades. Moscow turned to Chinese state-owned companies to help pay for oil and gas development after Crimea-related sanctions cut off Western financing.

“The help will never come for free,” Shagina said.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

Rudy Giuliani...

Associated Press

Rudy Giuliani is the final defendant to serve indictment in Arizona fake elector case

Rudy Giuliani has been served an indictment in Arizona's fake elector case for his role in an attempt to overturn the 2020 election.

15 hours ago

Houston storms cause widespread damage on Friday...

Associated Press

Some in Houston facing no power for weeks after storms cause widespread damage, killing at least 4

Houston storms cause widespread damage on Friday, May 17. Thunderstorms hit the southeastern part of Texas, killing at least four people.

2 days ago

Man gets 30 years in prison for attacking ex-Speaker Nancy Pelosi’s husband with a hammer...

Associated Press

Man gets 30 years in prison for attacking ex-Speaker Nancy Pelosi’s husband with a hammer

A man has been sentenced to 30 years in prison for attacking the husband of then-House Speaker Nancy Pelosi with a hammer.

2 days ago

audio from President Joe Biden’s interview about classified documents blocked...

Associated Press

GOP advances Garland contempt charges after White House exerts executive privilege over Biden audio

The move to release audio from President Joe Biden’s interview about classified documents was blocked on Thursday by the White House.

3 days ago

Asylum processing for new migrants: Changes could come soon...

Associated Press

The Biden administration is planning more changes to quicken asylum processing for new migrants

The Biden administration is planning to quicken the asylum processing for new migrants as an interim step rather than an executive order.

4 days ago

Record-setting rally for U.S. stocks reflects inflation slowing down...

Associated Press

Stock market today: Asian shares advance after another round of Wall St records

The S&P 500 jumped 1.2% to top its prior high set a month and a half ago. This move reflects a record-setting rally for U.S. stocks.

4 days ago

Sponsored Articles

...

DESERT INSTITUTE FOR SPINE CARE

Desert Institute for Spine Care is the place for weekend warriors to fix their back pain

Spring has sprung and nothing is better than March in Arizona. The temperatures are perfect and with the beautiful weather, Arizona has become a hotbed for hikers, runners, golfers, pickleball players and all types of weekend warriors.

...

Day & Night Air Conditioning, Heating and Plumbing

Day & Night is looking for the oldest AC in the Valley

Does your air conditioner make weird noises or a burning smell when it starts? If so, you may be due for an AC unit replacement.

...

Fiesta Bowl Foundation

The 51st annual Vrbo Fiesta Bowl Parade is excitingly upon us

The 51st annual Vrbo Fiesta Bowl Parade presented by Lerner & Rowe is upon us! The attraction honors Arizona and the history of the game.

China’s Russia dealings irk US, but don’t breach sanctions