China turns back on the West as oil giant exits UK, US and Canada 'over sanctions fears'

China National Offshore Oil Corporation (CNOOC) is one of the largest national oil companies in China and operates in the areas of crude oil and natural gas. Industry sources told Reuters the company will withdraw its business from the Western market, amid fears of being struck by sanctions similar to those imposed on the Russian capital.

China has so far failed to join the world in condemning the invasion of Ukraine with financial sanctions.

The country has also abstained from two votes of the United Nations calling Vladimir Putin to withdraw his troops from Ukraine.

However, the Chinese state-run Sinopec Group did pull out of a $500 million (£380 million) deal to market Russian gas for Sibur in China, as it was announced in late March.

US President Joe Biden has warned China against assisting Russia in evading the effects of sanctions, threatening consequences.

Getty/CNOOC Xi Jinping and an oil field

Tensions between China and the West were also spiked recently amid fears of aggression against Taiwan, which has a defence pact with the US.

CNOOC entered the Western market less than ten years ago after a $15 billion (£11.5 billion) acquisition of Canada's Nexen, finalised in 2013.

The company has since been a leading global producer.

Further to its North Sea oil fields and platforms, CNOOC's assets include fields in the Gulf of Mexico and large Canadian oil sand projects.

CNOOC is benefitting from an unprecedented spike in oil and gas prices, since the Russian invasion of Ukraine and the effect of sanctions on Russian oil exports.

Western countries seek to halt their dependency on Russian oil by developing domestic production, and CNOOC could tap into this opportunity to attract buyers.

In March, the Chinese Ministry of Foreign Affairs held a meeting with representatives from the country's three main energy companies.

Representatives from Sinopec, CNOOC, and China National Petroleum Corp (CNPC) were present at the meeting.

An executive at Sinopec then told Reuters: "Companies will rigidly follow Beijing's foreign policy in this crisis."

The executive added: "There's no room whatsoever for companies to take any initiatives in terms of new investment."

CNOOC has been approached for comment.

Reference: Daily Express: Vassia Barba