TAIPEI (Taiwan News) — Taiwan’s increasing reliance on Russian naphtha has raised concerns that China could use its ties with Russia to disrupt supplies, posing a risk to the nation’s economic stability, per Financial Times.
Taiwan became the world's largest importer of Russian naphtha in the first half of this year, according to a report by the Helsinki-based Centre for Research on Energy and Clean Air. Since February 2022, Taiwan has imported 6.8 million tonnes of Russian naphtha, valued at NT$159.25 billion (US$4.9 billion), accounting for 20% of Russia’s total naphtha exports.
As naphtha is a key material in the petrochemical and semiconductor industries, Taiwan’s dependence on Russian supplies raises concerns that China could leverage this reliance to affect Taiwan’s economic development.
While Taiwan’s state-owned enterprises halted imports of Russian naphtha following the outbreak of the Russia-Ukraine war, some private companies have significantly increased their purchases.
CREA noted that Formosa Petrochemical Corp's refinery in Yunlin accounted for 96% of Taiwan’s total Russian naphtha imports since early 2022. The company’s share of Russian naphtha in its overall imports rose from 9% in 2021 to 90% between January and June of this year.
In response, the company said it sources naphtha through a public bidding process without origin restrictions and emphasized that all suppliers and shipments comply with EU sanctions and global trade rules.
CREA added that the price Taiwan pays for Russian naphtha exceeds the G7’s price cap of per barrel, increasing the risk that Taiwan could face fines or sanctions.
In addition to naphtha, CREA reported that Taiwan has continued purchasing Russian coal, a move that could be seen as indirectly financing Russia’s war efforts. Taiwan has become the world’s fifth-largest buyer of Russian coal, importing a total of NT$132 billion worth of coal as of June. Despite state-owned utility Taipower halting Russian coal imports in 2022, some local private companies have continued buying it, CREA said.
DPP Legislator Chen Kuan-ting (陳冠廷) said that Taiwan should avoid relying on countries or companies that do not recognize its sovereignty or may have hostile intentions. Puma Shen (沈伯洋), another DPP lawmaker, emphasized that such dependence could pose a national security crisis.
Sun Hsin-hsuan (孫興瑄), director of corporate accountability and international affairs at Taiwan’s Environmental Rights Foundation and co-author of the CREA report, urged caution over the sanctions and supply risks linked to Taiwan’s dependence on Russian fossil fuels.
