Sanctioned Indian Refiner Taps Dark Fleet Market for Russian Oil

Nayara Energy, the Indian refiner partially owned by Rosneft that became a sanction target for the European Union, has turned to sanctioned tankers to keep buying Russian oil, Reuters has reported, citing data from LSEG.

The report cited an unnamed source from the shipping industry as saying that Russian business entities were helping the Indian refiner stock up on crude.

According to the data, Nayara Energy has imported at least seven cargos of Russian crude on tankers that include sanctioned vessels, carrying a total of 700,000 barrels. Nayara Energy accounts for some 8% of India’s total refining capacity. It operates a 400,000-bpd refinery in Vadinar, which is the second-largest in the country. The facility is 49% owned by Russia’s Rosneft.

Reuters noted in its report that India does not recognize unilateral sanctions, such as the ones that the European Union keeps imposing on Russia in packages – 18 to date and a 19^th in the works. The country only recognizes and complies with UN sanctions.

Earlier this month, media reports said that Nayara had shrunk its crude oil purchases significantly, going from an average daily of 366,000 barrels this time last year to just 94,000 barrels.

Last month, in a first move against customers of Russian oil, the EU expanded sanctions on entities doing business with the country’s oil industry, including via asset freezes, travel bans, and 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.

Earlier this week, the Russian embassy in New Delhi said it had found a new mechanism that would keep Russian oil flowing into India despite the threat by U.S. President Donald Trump to slap an additional 25% tariff on Indian imports unless it stops buying crude from Russia.

By Irina Slav for Oilprice.com

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