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China’s Sinopec Group pauses Russia projects

China's Sinopec

Beijing, (Business News Report)|| China’s state-run Sinopec Group has suspended its work in Russia, in a major development of the Russian-Ukrainian crisis.

China’s Sinopec is the largest oil refiner in Asia, and the Chinese company’s decision comes at a time when Beijing opposes Western sanctions imposed on Russia.

The company Sinopec announced the suspension of talks on a major investment in petrochemicals and a gas marketing project in Russia.

This came in response to a government call for caution as sanctions on Russia escalated due to the Russian-Ukrainian crisis.

The freezing of investment by the largest oil refiner in Asia, which was expected to reach half a billion dollars, reflects the current risks of opening relations with Russia, even for China, which is Russia’s most important diplomatic partner, in light of the harsh sanctions imposed by the West, according to Reuters.

Beijing has expressed its opposition to the sanctions, insisted that it will maintain normal economic and trade exchanges with Russia, and has refused to condemn Moscow’s actions in Ukraine or describe them as an “invasion.”

The Chinese government is concerned about the exposure of Chinese companies to sanctions, which is why it is pressing companies to move cautiously regarding investments in Russia, the second largest oil supplier and the third largest gas supplier.

Already, three large energy companies in China (Sinopec, China National Petroleum Corporation, and China National Offshore Oil) have been assessing the impact of sanctions on their multi-billion dollar investments in Russia, since the start of the war on February 24, 2022, according to sources familiar with the matter. command.

An executive in a state oil company stressed that the companies will follow Beijing’s foreign policy in this crisis with the utmost firmness, as there is absolutely no way for companies to take initiatives with new investments.

The State Department this month summoned officials from the three energy companies to review their trade relations with Russian partners and local operations, according to two sources familiar with the meeting, one of whom said the ministry urged them not to take any steps to buy Russian assets.

Last Thursday, US President Joe Biden indicated that China knew that its economic future was linked to the West, after the Chinese leader, Xi Jinping, warned that Beijing might regret its siding with Russian aggression.

Major international oil companies such as Shell and the Norwegian company Equinor also pledged to exit Russian investments shortly after Russian forces entered Ukraine on February 24.

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