China’s Secret LNG Fleet Aids Russia’s Sanctioned Energy Trade

China’s Shadow Fleet Helps Russia Bypass LNG Sanctions Amid Energy Shifts

China is expanding its seaborne LNG purchases, with a focus on diversifying supply and strengthening ties with Russia. This move comes as Russia seeks new buyers for its LNG exports, a key part of its post-European energy strategy. Meanwhile, China is assembling a 'shadow fleet' of tankers to import US-sanctioned Russian LNG, mirroring patterns seen in Russian oil transport to skirt sanctions.

Yanchang Petroleum, one of China's largest oil refiners, is seeking non-Russian oil for deliveries, indicating a shift in China's crude oil sourcing strategy. The vessel CCH Gas, reportedly carrying a blacklisted Russian cargo, is hiding its location as it heads towards China. The registered owner, CCH-1 Shipping Co., is linked to a Hong Kong address shared with a shell company used to obscure beneficial ownership, a common tactic in sanctioned energy trade. Another vessel, Kunpeng, was spotted near Singapore under similarly opaque ownership arrangements, unusual in the LNG industry.

Russia began building its own LNG shadow fleet last year, accumulating more than a dozen vessels registered under shell companies. Chinese ownership and vessel movements in LNG transport are mirroring these patterns, suggesting a coordinated effort to help Moscow evade Western restrictions and strengthen ties.

The expansion of China's LNG purchases, coupled with the use of shadow fleets and opaque ownership arrangements, signals a concerted effort to support Russia's energy sector amidst Western sanctions. As Russia continues to build its LNG shadow fleet, the international community watches closely to assess the impact of these maneuvers on global energy markets and geopolitical dynamics.