China chokes North’s oil supply
Beijing to stop buying textile from Pyongyang as part of UN sanctions
China announced on Saturday that it will limit energy supplies to North Korea and stop buying its textiles under UN sanctions imposed over its nuclear and missile development, further reducing support from Pyongyang’s last ally.
Exports of refined petroleum to the North will be limited to 2 million barrels per year, effective January 1, the commerce ministry said. Sales of liquefied natural gas are banned outright.
North Korea depends on China for almost all its oil and gas but estimates of its consumption are low, leaving it unclear how Beijing’s new limit will affect them. The restrictions announced on Saturday do not apply to crude oil, which makes up the biggest share of energy exports to the North.
According to the US mission to the United Nations, Beijing provides Pyongyang with around 4 million barrels a year of crude oil, and 4.5 million barrels of refined oil products such as petrol and diesel.
In North Korea petrol is sold by the kilogram rather than the litre, and payment in hard currency is required for retail buyers.
“It was $1.90 on Friday, today it is $2,” said a petrol station employee. “I expect the price will go up in the future.”
In January prices were below $1 per kg, and stood at around $1.65 in July, so they have gone up about 20 per cent in the last two months and more than doubled so far this year.
China also will ban textile imports from the North, the ministry said. Textiles are believed to be the North’s biggest source of foreign revenue following rounds of UN sanctions under which Beijing cut off purchases of coal, iron ore, seafood and other goods.
China accounts for some 90 per cent of the North’s trade, making its cooperation critical to efforts to derail Pyongyang’s nuclear and missile development.
Chinese leaders have long been the North’s diplomatic protectors but express increasing frustration with the government of Kim Jong Un. They support the latest UN Security Council sanctions but are reluctant to push Pyongyang too hard for fear Kim’s government might collapse.
They also argue against doing anything that might hurt ordinary North Koreans. They complain their country bears the cost of enforcing sanctions, which have hurt businesses in its northeast that trade with the North. —