The China National Petroleum Corporation, the country’s state-owned gas and oil company, has ceased sales to North Korea due to fear of lack of payment according to a Reuters report Wednesday. The move comes amid a backdrop of mounting American pressure on China to be more forceful with the isolated nation.

“This move is reputed to be for purely economic reasons — the China National Petroleum Corporation's concern about not getting paid for its oil deliveries,” said William Keylor, an international relations professor at Boston University, to International Business Times. “But it may also be part of a new political campaign to nudge Pyongyang into either cutting back on its nuclear program or engaging in talks to bring that about. Washington has been pressuring Beijing to be more proactive in approaching the nuclear issue, and this may be a signal that the Chinese are responding to this pressure.”

READ: What’s Happening With North Korea’s Nuclear Site? Activity Overshadows US-China Meeting

Reuters’ sources said that the move was economic, and added that gambling on a future payment was no longer worth the risk as Chinese and international banks are looking closely at compliance in dealing with entities sanctioned by the U.S.

Last year China shipped over 96,000 tons of gasoline and just under 45,000 tons of diesel gas to North Korea.

As tensions grow between the U.S. and North Korea, China is squeezed as a middle man. China is North Korea’s main trading partner and the U.S. has leaned on China to pressure the country economically so it will cease on its quest to create long-range nuclear weapons. Last week Secretary of State Rex Tillerson and Defense Secretary Jim Mattis met with their Chines counterparts and North Korea was one of the main topics. Overshadowing their meeting was a tweet from President Donald Trump.

“While I greatly appreciate the efforts of President Xi & China to help with North Korea, it has not worked out. At least I know China tried!” the president wrote.

China suspended coal purchases from North Korea for the year after a February test of an intermediate range ballistic missile. North Korea exports almost all of its coal to China. There were also missile tests in April, May and June.

The call for more action against North Korea reached a fever pitch in June when an American prisoner, 22-year-old Otto Warmbier, was released from the country and subsequently died. Warmbier was a tourist in North Korea when he was detained and sentenced to 15 years of hard labor for allegedly stealing a propaganda poster. He was released back to the U.S. in a coma and with severe brain damage. He died in a hospital in his native Ohio several days later of unknown causes.

READ: How World Leaders Reacted To Otto Warmbier’s Death After Time In North Korea Prison

“[There] is nothing more tragic for a parent than to lose a child in the prime of life,” said Trump in a statement on Warmbier. “The United States once again condemns the brutality of the North Korean regime as we mourn its latest victim.”

North Korea still holds three American prisoners.</s>The National Oil Corporation (NOC) has advertised new tenders:</s>Reuters reported on Wednesday that China’s state-controlled National Petroleum Corporation has suspended fuel sales to North Korea for an undetermined period of time. CNPC is the primary supplier of fuel to North Korea.

On the surface, it appears that China is using its ultimate leverage with Pyongyang. Threats to North Korea’s oil supply are regarded by some observers as the best way to tell when Beijing truly loses patience with its psychotic client state.

It also seems noteworthy that the Chinese move comes after President Trump’s public expressions of frustration with China regarding the North Korean crisis, and rumbles from the administration that new sanctions against China may be forthcoming.

The sanctions most immediately in prospect concern Chinese complicity in human trafficking. The U.S. State Department published a report on Tuesday labeling China one of the worst human trafficking nations in the world, with Secretary of State Rex Tillerson citing China’s importation of forced North Korean labor as one of the most serious offenses.

This report has been widely interpreted as a sign of deteriorating U.S.-China relations, and perhaps even as focused retaliation for China’s failure to bring North Korea to heel, even though the report was surely under construction for a long time–and frankly, China’s human trafficking problems are so severe that willful blindness would be required to ignore them.

The Chinese government claims the decision to suspend North Korean oil sales is “commercial” in nature, not a punitive action against the Kim regime’s pursuit of nuclear missiles. To put it bluntly, the Chinese say they are afraid North Korea will not pay the bills for its oil shipments, due largely to the impact of international sanctions against the regime’s missile and nuclear programs.

As Reuters portrays it, there is some degree of confusion in the Chinese government and CNPC management about which fuel sales were suspended and why. One source suggested the Chinese are making a more vigorous effort to cooperate with sanctions against North Korea, and they realize their efforts will make it harder for Pyongyang to pay its bills.

Reuters analysts found substantial evidence for a significant reduction of Chinese oil shipments to North Korea last month, reflected by much higher gas prices in the outlaw state. Complete data for June will be needed before analysts can determine if this is a lasting policy trend or a one-month statistical blip. Crude oil shipments from China to North Korea don’t seem to have been significantly reduced yet, just processed gasoline and diesel fuel.

A report at OilPrice.com suggests the spike in North Korean gas prices may have been caused by fear of a possible Chinese oil embargo, rather than the more modest actions they have already taken.

The South China Morning Post reported on Wednesday that according to a high-ranking defector, North Korea has largely managed to shift its fuel imports to Russia, which would greatly reduce China’s oil leverage.

“It is a wrong perception that North Korea is completely dependent on China,” said defector Ri Jong-ho.

He said dictator Kim Jong-un’s plan to replace Chinese oil with imports from Russia has been moving ahead at full steam since 2014, when a visit from Chinese President Xi Jinping to South Korea “infuriated” Kim and prompted him to begin viewing China as an “enemy state.”

If Ri’s assessment is correct, then some of the public confusion from the Chinese government over suspended fuel sales to North Korea might be due to the reluctance of Chinese officials to admit they have lost much of their leverage over Pyongyang. China has traditionally profited greatly from selling itself as the last resort for curbing the worst excesses of the Kim regime. If that posture is now a bluff, Beijing will not want it to be called, and the current suspension of fuel sales might really be best understood as apprehension over North Korea’s willingness and ability to pay.</s>Chinese national oil corporation CNPC has ceased fuel sales to isolated North Korea, Reuters reports. Beijing is worried Pyongyang will not pay for the fuel, according to the news agency.

Reuters says it’s unclear how long the suspension will last. China is North Korea’s top supplier of diesel and gasoline. Relations between neighbors have deteriorated in the past few months.

When asked by the media about the suspension, Chinese foreign ministry spokesman Lu Kang replied: "I do not understand this situation you are talking about" and declined to elaborate.

However, the decision is more about business than politics, said one of Reuters’ sources.

"It's no longer worth the risks," said the source. CNPC demands upfront payments, and North Korea has failed to pay them in the last one or two months, the source said.

Last year, China shipped just over 96,000 tons of gasoline and almost 45,000 tons of diesel worth a combined $64 million to its neighbor.

May data says fuel sales to North Korea significantly dropped. Data for June will be available in July.

As Reuters claims, fuel prices in North Korea have sharply risen in recent months, suggesting a tightening in supply.

In February, China stopped buying coal from North Korea, its key export. In 2016, North Korea sold 22.5 million tons of coal to China, worth about $1.9 billion, according to Chinese customs data.

US President Donald Trump has repeatedly urged Beijing to put more pressure on Pyongyang over its missile tests. China has said its influence on North Korea is limited.</s>China’s largest supplier of fuel to North Korea has halted sales amid growing pressure on Pyongyang, according to Reuters.

State-owned oil giant China National Petroleum Corp (CNPC) reportedly suspended exports, citing worries that agents will not be able to provide the up-front payments it requires. Banks and companies involved with North Korean trade are now under increased scrutiny, though it is not clear if sanctions are related to CNPC’s decision.

The isolated northeast Asian country imports almost of its oil and gas from China; most of that comes through CNPC. The risks of doing business with North Korea have grown steadily in recent months as the United States has ratcheted up pressure in response to Pyongyang’s frequent missile launches. CNPC’s move to stop fuel sales results from business risk, according to the Reuters report, rather than from a change in official Chinese policy.

Frequent missile tests and advances in North Korea’s nuclear capabilities have put regional states on edge and created a major foreign policy test for U.S. President Donald Trump. U.N. sanctions forbid the sale of rocket, jet, and certain kinds of aviation fuel, though oil and gas for civilian purposes has not faced restrictions. U.S. officials have floated the idea of an oil embargo as one possible measure to force the rogue regime to roll back its nuclear program.

Without Chinese oil, “North Korea would not survive on its own for three months and everything in North Korea would be paralysed,” Cho Bong-hyun, a specialist on the North Korean economy at Seoul’s IB Bank, told Reuters in April.

The United States might hope to bring Pyongyang to its knees, but for China that would be a nightmare scenario. The last thing Beijing wants is a destabilized nuclear-armed North Korea and millions of destitute refugees pouring over its northern border.

Still, temporary cuts to fuel exports is one way for Beijing to send a clear message to its neighbor. China has previously used such messages to pressure Pyongyang.

In 2003, China closed an oil pipeline supplying North Korea for three days. Chinese officials said the closure was due to technical problems, but diplomats said that the true intent was to put pressure on Pyongyang amid heightened tensions with the United States over its nuclear program. A few months later, North Korea joined six-party talks with the United States.

Beijing has worked to bring its coal-hungry importers in line with U.N. sanctions, essentially banning the import of North Korea coal in February.

But overall trade between China and its northern neighbor actually grew in the first quarter of 2017 despite U.S. pressure. Trump, who had made China the center of his approach to pressuring North Korea, has reportedly grown frustrated with Beijing’s refusal to wield its full influence over Pyongyang.</s>‘It’s Not Worth The Risks’: Chinese Oil Giant Suspends Fuel Sales To North Korea

A top Chinese state-owned oil and gas company has reportedly suspended fuel sales to North Korea, according to inside sources.

China National Petroleum Corp has decided to put fuel sales on hold because doing business with Pyongyang is “no longer worth the risks,” sources with direct knowledge of the situation told Reuters. Regular compliance checks to determine whether a company or firm is in violation of sanctions are increasing the pressure, especially in China, which accounts for almost 90 percent of all North Korean trade. Furthermore, North Korea is often an unreliable business partner, as firms frequently fail to pay for goods and services.

Reuters speculated that Chinese companies may be facing credit crises as Chinese and international banks address sanctions compliance issues but was not able to confirm.

Neither Beijing nor CNPC have acknowledged the sales suspension, with a Ministry of Foreign Affairs spokesman commenting that he was no aware of the situation when reporters questioned him.

CNPC is one of China’s leading energy companies, and it provided the vast majority of the fuel sold to North Korea last year. China sent 96,000 tons of gasoline and 45,000 tons of diesel collectively worth $64 million to North Korea in 2016 for civilian and military purposes.

Data for fuel shipments to North Korea, as well as rising fuel prices in the North, suggest that China may be cutting the supply.

China suspended coal shipments to North Korea in February and reportedly played an active role in convincing North Korea not to conduct another nuclear test, but there is more that can be done.

“China is still falling far short of what it could bring to bear on North Korea in terms of pressure,” a senior White House official explained to reporters Wednesday, “Coal is only one component of that. We very much want to see China do more than it’s willing to do, while we do recognize that China is doing more than it has done in the past.”

“There has to be more pressure on the North Korean regime,” White House National Security Adviser H.R. McMaster said Wednesday, “China has a great deal of control over the situation.”

Beijing argues that its power to influence Pyongyang is limited and that it is doing the best it can, asserting that it is neither the cause nor the crux of the current crisis on the Korean Peninsula, despite clear evidence that the regime has been empowered by China for decades.

China has cut fuel sales to North Korea in the past, sending a message to Pyongyang, but even when China steps up the pressure, the North will often turn to other sources.

Ri Jong Ho, a former North Korean official who served in Office 39, which secured supplies and hard currency for the regime through illegal activities and exchanges, before he defected, revealed recently that North Korea secures up to 300,000 tons of oil products from Russia through dealers operating out of Singapore and has been doing so since the 1990s.

“It is a wrong perception that North Korea is completely dependent on China,” Ri told Kyodo News, explaining that North Korea has been trying to reduce its dependence on China since Kim Jong Un issued an order to expand trade with Russia and Southeast Asia in 2014. Ri did, however, acknowledge that North Korea still obtains around 500,000 tons of crude oil each year from China, giving Beijing a certain degree of leverage.

Content created by The Daily Caller News Foundation is available without charge to any eligible news publisher that can provide a large audience. For licensing opportunities of our original content, please contact [email protected].</s>China National Petroleum Corp has suspended sales of fuel to North Korea over concerns the state-owned oil company won't get paid, as pressure mounts on Pyongyang to rein in its nuclear and missile programmes, three sources told Reuters.

BEIJING: China National Petroleum Corp has suspended sales of fuel to North Korea over concerns the state-owned oil company won't get paid, as pressure mounts on Pyongyang to rein in its nuclear and missile programmes, three sources told Reuters.

It's unclear how long the suspension will last. A prolonged cut would threaten critical supplies of fuel and force North Korea to find alternatives to its main supplier of diesel and gasoline, as scrutiny of China's close commercial ties with its increasingly isolated neighbour intensifies.

CNPC and the Ministry of Commerce did not respond to requests for comment. China's Foreign Ministry declined immediate comment. North Korea's embassy in Beijing declined to comment.

A source with direct knowledge of the matter said CNPC decided to put fuel sales on hold "over the last month or two" and described it as a "commercial decision".

"It's no longer worth the risks," said the source. Chinese and international banks are stepping up compliance checks on companies dealing with countries on the U.S. sanctions list, such as North Korea, he said.

The North Korean agents who mostly buy the diesel and gasoline have been unable recently to pay for the supplies - CNPC normally requires upfront payments, the source said.

Reuters was unable to determine if the agents have started facing credit problems with Chinese and international banks worried about sanctions compliance issues.

Two other sources briefed about CNPC's decision confirmed the suspension of diesel sales, but did not know directly about the gasoline move. The three people declined to be named due to the sensitivity of the matter and are not authorised to speak to the media.

Last year, China shipped just over 96,000 tonnes of gasoline and almost 45,000 tonnes of diesel worth a combined US$64 million to North Korea, where it is used across the economy from fishermen and farmers to truckers and the military.

Most of that was sold by CNPC, which has grown over the past two decades to dominate China's energy trade with Pyongyang.

Data for May released on Friday showed China supplied significantly lower volumes of diesel and gasoline compared with a month earlier, although monthly tonnages can vary widely. June data will be released in late July.

Fuel prices in North Korea, meanwhile, have sharply risen in recent months, suggesting a tightening in supply.

A Reuters analysis of data collected by Daily NK showed the price of gasoline sold by private dealers in Pyongyang and the northern border cities of Sinuiju and Hyesan had hit US$1.46 per kg on June 21, up almost 50 percent from April 21. Until then, they had remained relatively stable since late last year.

Diesel prices averaged US$1.20 per kg as of June 21, more than double over the same period, according to Daily NK, a website run by defectors who collect prices via phone calls with North Korean fuel traders.

North Korea's unprecedented pace of nuclear and ballistic missile tests has prompted China, which handles 90 percent of North Korea's trade, to start squeezing Pyongyang.

In February, Beijing suspended coal purchases until the end of the year, cutting off North Korea's main export revenue source. In 2016, North Korea sold 22.5 million tonnes of coal to China, worth about US$1.9 billion, according to Chinese customs.

The United States has pressed China to exert more economic and diplomatic pressure on North Korea, but Beijing has said its influence on North Korea is limited and it is doing all it can.

President Donald Trump, frustrated over Beijing's inaction on North Korea and bilateral trade issues, is now considering possible trade actions against China, three senior administration officials told Reuters on Tuesday.

The sources in China saw no sign yet that Beijing is cutting crude oil to Pyongyang. China has not disclosed its crude exports to North Korea for several years, but industry sources say it supplies via an aging pipeline about 520,000 tonnes of crude a year to North Korea, worth about US$170 million at current market prices.

North Korea imports all its oil needs, mostly from China and a much smaller amount from Russia.
Fearing lack of payment, China National Petroleum Corporation stops selling oil to North Korea.