Indian refiner Nayara Energy, in which Russia’s top oil firm Rosneft holds 49%, is already experiencing disruption to its fuel exports, days after the EU sanctioned the refiner for being a major customer of Russian crude.
Last Friday, the EU adopted the 18th sanctions package against Russia, targeting a hundred more ‘shadow fleet’ tankers, energy trade, and traders and banks enabling it.
In a first move against customers of Russian oil, the EU expanded sanctions on entities doing business with Russian oil, including via asset freezes, travel bans, bans on providing resources. The bloc sanctioned Russian and international companies managing shadow fleet vessels, traders of Russian crude oil, and a major customer of the shadow fleet – the Nayara Energy refinery in India with Rosneft as its main shareholder.
The Indian refiner has changed the payment terms to sell a spot naphtha cargo seeking advance payment or a letter of credit from the potential buyer for loading of the cargo in mid-August, a tender document seen by Reuters showed on Monday.
In addition, a tanker chartered by BP left on Sunday the Indian port of Vadinar without loading ultra-low sulfur diesel from Nayara’s terminal, Reuters reported, quoting industry sources and vessel-tracking data from LSEG.
The booking was cancelled after the EU sanctions, shipbrokers told Bloomberg on Tuesday.
Another tanker, chartered by PetroChina, will not be loading diesel at Nayara’s Vadinar port the end of this month en route to Southeast Asia, sources told Reuters on Wednesday.
The tanker, the Chang Hang Xing Yun, is expected instead to load ultra-low sulfur diesel (ULSD) from Kuwait on August 1 and head to East Africa, per LSEG ship-tracking data and a shipping source who spoke to Reuters on Wednesday.
Moreover, due to the fresh EU sanctions targeting oil derivatives made from Russian crude in third countries, Indian refiners would likely need to tap the services of fuel traders to find new markets for their output.
India is one of the largest buyers of Russian crude, and a lot of the fuels it makes from that crude end up on the European market.
By Charles Kennedy for Oilprice.com
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