China’s biggest oil producers, PetroChina Co. and China Petroleum & Chemical Co. (Sinopec), look to be the big gainers as energy exporting countries look to dump assets. Russia, in particular, has been eager to offload their oil and gas reserves in exchange for immediate monetary relief as their economy suffers from the credit crunch.
“This is a new opportunity for China to obtain overseas oil and gas resources, provided by the financial crisis,” said Gong Jinshuang, a senior engineer with China National Petroleum.
On Tuesday, China agreed to grant Russia a $25 billion loan in exchange for 20 years of crude oil supplies. The deal looks to benefit PetroChina and Sinopec directly as they will be able to purchase Russian oil at around $20 a barrel.